January 9, 2020 (MLN): National Clearing Company of Pakistan Limited (NCCPL) via notification to PSX has apprised the market participants regarding following key measures/ procedures which would be executed by NCCPL at the time when Index-Based Market halt is triggered by Pakistan Stock Exchange.
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Once the Market Halt triggered on the intimation of Exchange, trading in all Markets shall be suspended by PSX for a period of 45 minutes.
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The Mark to Mark (MTM) losses shall be determined by the Company including affirmed institutional delivery system transactions of the Non-Broker Clearing Members on the basis of last executed price during trading hours on a trading date for all Markets;
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Each Clearing Member “CM” shall be required to pay MTM losses within the prescribed time on the trade date when Market Halt occurred;
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A new report will be available in NCC systems where CM can view MTM Losses demand for all Markets at the time of Market Halt;
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MTM Losses demand other than Regular Market shall be deposited in the form of cash only. CMs are advised to ensure availability of sufficient fund in their respective bank accounts.
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CMs of Regular Market can deposit MTM Losses demand in the form of any type of approved collateral through existing mechanism within the prescribed time.
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Settling Banks shall be required to confirm the collection of Mark to Mark losses in cash within stipulated time before re-opening of Market on trade date.
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Broker Clearing Member fails to pay MTM losses determined by the Company within the prescribed time in any Market at the time when Market Halt is implemented, shall not be allowed to take any fresh position during the day before paying the amount of Mark to Mark losses. The amount of MTM loss determined by the Company at the end of trade date shall be deposited as per the existing mechanism in accordance with NCCPL Regulations.
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The IDS affirmation facility shall not be available to those Non-Broker Clearing Members who failed to deposit required MTM Losses to NCCPL within the prescribed time during the trading day.
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After collection of MTM losses due to Market Halt, the updated demand/collateral position shall be available on PSX Pre-trade system / Exposure Monitoring System “EMS”.
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DTS and Reports format will be notified to Market Participants in due course.
Moreover, it is pertinent to mention that the implementation of widening of Circuit Breakers and introduction of Market Halt shall take effect from January 20, 2020.
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