Saeed Al Khotani Saudi Gazette RIYADH – The Saudi Capital Market Authority (CMA) formed an advisory committee composed of all stakeholders in the money market in the Kingdom, CMA Governor Mohammed Al Sheikh said Sunday at the opening ceremony of the 2nd Annual Saudi Securities Forum. “The committee, composed of members from the Authority, banks, investment corporations, investors, academics, financial consultants, and journalists, will provide consultation, advise, suggestion and recommendations that will enhance the role of the Authority in doing its mandate and develop the Saudi capital market to better levels,” he said. The governor further said that the level of transparency by Saudi companies in announcing the financial data has risen by 26.4 percent in 2012 to 3,771 announcements. The Deputy Emir of Riyadh, Prince Turki Bin Abdullah, said in opening the event: “It is a great honor to me to open this event on behalf of my brother, Emir of Riyadh, Prince Khalid Bin Bandar. It is an event that aims to improve the capital market by providing more insight by the participating experts for its stability, transparency and better service.” Prince Turki commended the Saudi economy, saying that because of the wise policy of the Custodian of the Two Holy Mosques King Abdullah, the Saudi economy is still among the 20 strongest economies in the world while most countries in the world are suffering from economic instability and problems. Dr Abdulrahman Al Zamil, the Chairman of RCCI, in his address, was optimistic that the forum will result in more recommendations to improve the capital market and shift it from a market driven by individual investor to institutions-driven one. The forum concluded its first day by tackling the role of monetary system and policy in protecting the financial market, the competitiveness of financial institutions, and the direction of governance in the capital market. The forum, Kingdom's premier securities event, organized by Riyadh Chamber of Commerce and Industry, represented by the Committee for Investment and Securities with the support and participation of the Capital Market Authority, will close Tuesday after discussing some important issues, among them, foreign investment and its implication on the capital market, and the evaluation of the impact of financial media on this market. Saudi Arabian officials are still discussing the opening of the stock market to direct foreign investment and no timetable has been set, the chief market regulator said Sunday. “We are still discussing the issue. I said this a few months ago and I don't think anything has changed,” Al Sheikh said. “Some government entities are looking into the issue and once there is something we will announce it. So far there is nothing new.” Foreigners - excluding Gulf Cooperation Council nationals, who have special access - can only buy Saudi shares through swap deals made by international investment banks or via a small number of exchange-traded funds. Al Sheikh said foreign investment through swap agreements now accounted for 1.25 percent of the market, compared to zero about five years ago. Saudi authorities have for years been laying plans to open the market, but they have not fixed a date to do so. Al Sheikh on Sunday dampened heightened speculation in the securities industry over the last several months that an opening might be near. “The market is abundant with liquidity and we do not need foreign investors' liquidity. What we need is the other things like increasing transparency, improving governance and training Saudis, so we focus on the other things,” he said. Al Sheikh also said authorities aimed to increase the overall level of institutional investment in the stock market and therefore hoped soon to launch new tools for institutional investors. Current tools are mutual funds, real estate investment funds and swap agreements; the swap agreements exceeded 20 billion riyals ($5.3 billion) by the end of June, Al Sheikh said without elaborating on the planned new tools.
