The Philippine Stock Exchange (PSE) said on Wednesday it has suspended stockbrokerage firm Globalinks Securities & Stocks Inc. (G_Link) for failing to meet the capitalization requirement for a stock broker, effective immediately.
The PSE said its regulatory arm, the Capital Market Integrity Corp. (CMIC), has ordered G_Link to immediately inform its clients of the suspension and its consequences, and to assist “in such a manner that their interests are not unduly prejudiced.”
“The involuntary suspension may only be lifted once CMIC determines that G_Link is compliant with all the pertinent capitalization requirements,” the PSE said in an order posted on its website.
“During the involuntary suspension, G_Link’s access to the trading system of the Philippine Stock Exchange, the depository online system of the Philippine Depository and Trust Corporation, and the clearing facilities of the Securities Clearing Corporation of the Philippines shall be restricted,” the PSE said.
Despite the suspension, transfers of securities from G_Link to another brokerage firm and done through sell transactions by its clients may be allowed, subject to CMIC approval, the PSE added.
However, trades by related parties of the stockbrokerage firm, and its proprietary trading, are prohibited.
The PSE did not provide information on the extent of capitalization deficit of G_Link.
CMIC rules require that a stockbroker has to have as much as P100 million in unimpaired paid-up capital, as provided by the implementing rules and regulations of the Securities Regulation Code (RA8799).
The same rule also provides that broker dealers that are not involved in market-making activities can have an unimpaired capital of just P10 million, provided it files the required surety bond in lieu of the P100 million capital.
