Thursday 8 December 2016

SUNRISE CAPITAL (PVT) LTD | 9 December 2016 | TAKE OFF

S.Korea's Kia to start assembling cars in Pakistan: local partner
South Korean carmaker Kia Motor Co will start assembling cars in Pakistan, according to a local partner that is planning to invest Rs12 billion ($115 million) to set up a plant and manufacture the Kia vehicles. Karachi-listed Lucky Cement, which is part of the vast conglomerate Yunus Brothers Group, said in a statement on Thursday it planned to set up a new company to start "manufacturing, assembling" Kia vehicles. It was not clear how much capital Kia itself would invest in the venture. Representatives for the South Korean company could not immediately be reached for comment. Kia cars had been assembled by Pakistan in the past but disappointing sales led to a halt in manufacturing. The new venture will also market and sell, besides import and export of, "all types of Kia vehicles, parts and accessories," Lucky Cement told the Pakistan Stock Exchange in a statement.
10.65pc capital adequacy ratio mandatory for banks:
The State Bank of Pakistan (SBP) has increased the required Capital Adequacy Ratio (CAR) for banks to 10.65 per cent, which will be implemented from the last day of the current calendar year, the third quarterly report of the central bank said. The current CAR requirement of 10.25pc includes a capital conservation buffer (CCB) of 0.25pc. “The CCB will increase to 0.65pc by December 31, 2016, bringing the CAR requirement to 10.65pc,” said the SBP. Pakistani banks have been sound in terms of CAR despite their poor performance on the economic front. Banks remained safe and profitable during the last couple of years mainly because of the government’s borrowing, which is both risk-free and high yielding for banks. The SBP said the solvency profile of the banking system further strengthened in the third quarter of 2016 (July-September) as CAR improved to 16.8pc at the end of September from 16.1pc at the end June, well above the regulatory requirement of 10.25pc.
Reserves down $270m:
Pakistan’s total liquid foreign exchange reserves amounted to $23.3 billion on December 2, down $270 million or 1.1 per cent from a week ago, the State Bank of Pakistan (SBP) said on Thursday. According to a statement released by the central bank, the decrease in reserves was on account of external debt servicing. SBP’s liquid foreign exchange reserves decreased 1.2pc week-on-week to $18.3bn. Net foreign exchange reserves held by commercial banks amounted to $4.9bn on Dec 2, registering a nominal decrease over the preceding week.
Pakistan, Iran look to revisit gas pipeline agreement:
Pakistan has shared with Iran amendments to gas sale and purchase agreement (GSPA) to extend implementation schedule and revise pricing under the $1.35-billion gas pipeline project. A senior government official on Thursday told Dawn that the Economic Coordination Committee (ECC) of the Cabinet hasn’t yet allowed the Ministry of Petroleum and Natural Resources to start formal negotiations with Iran over fresh pricing. He said the ministry requested the ECC in July this year to revive a committee to start formal talks and “we are still waiting for the approval”. The petroleum ministry told parliament a few days ago that for the Iran-Pakistan (IP) project to be implemented in the extended period, “amendment to the GSPA was required”. It said a draft amendment had been shared with Tehran that agreed to negotiate it along with some other changes.
Understanding: Pakistan, Italy textile groups to ramp up cooperation:
Trade organisations of Pakistan and Italy have reached an understanding on promoting and expanding cooperation between textile and apparel companies of the two sides. Pakistan Readymade Garments Manufacturers and Exporters Association (PRGMEA) and the Association of Italian Textile Machinery Manufacturers (ACIMIT) inked a memorandum of understanding (MoU) for collaboration. Representatives of major apparel associations and many leading Italian textile machinery manufacturing companies were present on the occasion. This is the first time that a Pakistani garment sector association has entered into an agreement with the Italian body for strengthening mutual trade in garments and textiles.
Chinese bourses keen on acquiring PSX stake:
Three of China’s financial market operators intend to jointly buy a combined stake of up to 40% in the Pakistan Stock Exchange (PSX), a person with close knowledge of the potential deal told China Daily. The source, who is with the Shanghai Stock Exchange (SSE), said the SSE and two other bourses in China have submitted a letter of intent to the PSX, China Daily reported. The source with the SSE revealed that the acquisition attempt is still undergoing procedures and more details will be disclosed jointly by the three buyers at an “appropriate time,” if the acquisition is successful. The acquisition, if successful, would be the first by Chinese bourses of a foreign stock exchange. China’s news and business social media platform jiemian.com reported on Wednesday that the three operators, namely the SSE, the Shenzhen Stock Exchange, and the Shanghai-based China Financial Futures Exchange, would like to buy stakes in the PSX, but the three operators declined to comment on the acquisition at the current stage.
US crude settles up 2.2% at $50.84, rallying after dip on OPEC deal doubt:
Oil rebounded from the week's lows to close above $50 a barrel on Thursday as market watchers focused on an upcoming weekend meeting between OPEC and non-OPEC producers that may result in an agreement to cut crude output further. Brent and U.S. oil prices gained support early from a slightly weaker dollar, but the U.S. currency turned positive as the euro fell on the European Central Bank's decision to extend but reduce its bond-buying program. North Sea Brent crude was up 94 cents, or 1.8 percent, at $53.94 a barrel by 2:35 p.m. ET (1935 GMT). U.S. light crude was up $1.07, or 2.2 percent, at $50.84 a barrel.
SECP issues 54 show-cause notices:
The Securities and Exchange Commission of Pakistan (SECP) initiated 54 show-cause proceedings and concluded 50 current proceedings during October and November against management and companies’ auditors for various violations, it said in a statement on Thursday. The commission mandates companies to ensure compliance in areas like inter-corporate financing, mandatory maintenance of websites and submission of quarterly reports. The SECP, after giving the companies reminders through the media to have mandatory company websites rendering critical information to current and potential investors, initiated 17 new show-cause proceedings against those who failed to do so.

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