Thursday, May 6, 2010

Kuwait Stock Exchange - Enhanced Supervision 10 Companies Under Investigation

Copyright Fg2

If we believe the report from AlQabas, the KSE may have to replace the  above carving which I understand currently is right over the entrance to its Supervision Section.  

According to the article, the Supervision Department has its "eyes open wide today" as compared to earlier periods when apparently its eyes were a bit more shaded from the light.  One certainly hopes that the process of adjusting to the light was gradual.  Otherwise serious ocular damage may have been caused.

In any case in the transitional period to the full implementation of the new Capital Markets Law we're told that the KSE is watching daily trading, monitoring activities for negative behavior, and taking appropriate regulatory action until it hands over the control lever (or rudder if you prefer a Kuwaiti appropriate nautical analogy).  Frankly,  precisely the actions you'd expect a stock market regulator to be doing as the normal discharge of its duties -- unless of course you understood how business was (is?) done up North. 

More than 10 companies are reportedly under investigation.  Trading of Board members is being scrutinized.  Files have been referred to the public prosecutor for legal action.  And where legal action is not warranted, the KSE will be dealing with minor infractions at an upcoming meeting of its committee of adjudication.

The article ran with this accompanying picture.


It's not clear to me if this is a "before" or "after" picture with respect to enhanced vigorous monitoring by the KSE.  But from what I know it's highly likely it's an "after" picture.   Supporting that view, you'll notice that the chap is actually at his desk!   And even though this is just a picture, I'm sure like me you can sense the tension as he focuses intently on monitoring the market. 

For those not familiar with the fact, I'd note that as part of the preparation for the implementation of the new law, KSE regulators were sent for a crash training course in a certain well-regulated market in the West.  The position being assumed by the KSE regulator at his desk is known in technical terms as "doing an Alan"  or sometimes "a half Greenspan".

In a separate post, I'll review a recent report by AlJoman Centre for Economic Consultancy - that shows the crying need for regulation.

2 comments:

The Rageful Cynic said...

Nasser Al Nafisi is a beacon of reason in a land of "fotha"...

Abu 'Arqala said...

TRC

From AlJoman and not KAUST I presume.

You've reminded me to finish up my post on the AlJ article.