SET reviews rules for transactions

SET reviews rules for transactions

The Securities and Exchange Commission (SEC) has agreed for the Stock Exchange of Thailand (SET) to review the criteria regarding cash accounts and the period for investors to settle their security transactions.

SEC secretary-general Pornanong Budsaratragoon said on Wednesday that the regulator and the SET held discussions, agreeing some regulations would be adjusted to restore confidence in the Thai capital market.

First the SET plans to review trading criteria for cash accounts, considering whether collateral should be placed before purchasing securities.

The goal is fairness between retail investors and foreign juristic persons who pay for securities trading through custodians, she said.

The SET also plans to adjust criteria regarding the period for investors to settle their security transactions.

The current period is within two business days (T+2) after the securities are purchased, said Ms Pornanong.

"The adjustment should ensure the SET regulations are appropriate, fit the current market conditions, and are fair to every type of investor," she said.

After the review is completed, it will be sent to the SEC for approval.

Ms Pornanong said earlier the period for investors to settle securities transactions may dip to only one business day (T+1), or the same day the transaction is made (T+0).

One factor to be considered is a suitable period for investors from different time zones to settle their payment.

The two organisations also agreed to review guidelines for members of the Association of Securities Companies to complete short-sell transactions.

The review should provide clearer guidelines for such transactions, in line with the market context and international standards, helping to prevent possible illegal activities, said Ms Pornanong.

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