New stock brokering companies should create a new base of customers in the market without catering to existing customers. This will be the most progressive way to develop the market, an industry expert said.
New stock brokering companies should not cater to existing customers who are serviced by some other stock broker. The Securities and Exchange Commission (SEC) has considered this when giving licences to new companies, Stock Brokers’ Association President Sriyan Gurusinghe told Daily News Business.
“As the voice of the Association, we would like to liberalize the market but it should ensure to bring new business into the market. We expect 60 new companies will go for IPOs this year and there will be opportunities for newly licensed stock brokering companies,” Gurusinghe said.
“Eventhough competition in the market is stiff, all stock brokering companies has recorded a profit for last year,” he said.
He said that when granting licences to new companies, the regulator has requested them to follow certain criteria such as setting up branches in rural areas. There is a requirement for new stock brokering companies to set up a specific number of branches in rural areas during a certain time. Existing companies also should set up branches in rural areas. Setting up branches in rural areas could be another way of developing the market.
“We have been looking at possibilities of getting more foreign investors to the Sri Lankan capital market. During the past two three years there was an outflow of foreign investors from the market. Currently we have been able to gain new foreign investments. We will be planning road shows in the future to increase foreign investors,”he said. The Stock Brokers’ Association is working closely with the SEC Financial Services Academy to conduct new courses that will be beneficial to investment advisors.
source - www.dailynews.lk
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