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JP Morgan ends equities trade in Pakistan
JP Morgan said that it was suspending its equities operations in Pakistan, where share trading has been on hold since August 28.
- Reuters
- Published: 23:24 November 28, 2008
Karachi/Hong Kong: JP Morgan said on Friday that it was suspending its equities operations in Pakistan, where share trading has been on hold since August 28.
It said it would maintain its seat on the Karachi bourse and continue to serve clients through third-party brokers.
The KSE-index ended flat on Friday at 9,187.10 points, just 43 points above its floor. No shares were traded.
The US bank said some of its roughly 10 or 12 equities staff would be redeployed within the firm, and that its eight-person treasury services business in the country would continue to operate.
"JP Morgan will continue to expand its treasury services business in Pakistan, but at the same time reduce its presence in equities, while keeping its seat on the Karachi stock exchange," bank spokesman Ray Bashford told Reuters.
Trading has dried up since the KSE board imposed an artificial floor on the 100-share benchmark on August 28 to stop a collapse in share prices that could have sent some investment firms to the wall.
This resulted in pay cuts and job losses.
Many dealers fear unemployment may set in if the floor is not removed soon.
Mark Mobius, executive chairman of Templeton Asset Management, criticised Pakistan two months ago for protecting share prices. He said it increased risks for investors seeking liquidity.
The KSE board met on Thursday to discuss removing the floor but did not reach a decision, a director told Reuters.
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