SSX faces closure as financial woes worsen<\/p>\n
SURABAYA (JP): The financially strapped Surabaya Stock
\nExchange (SSX) might have to cease operating if existing
\nshareholders refuse to inject fresh funds into the East Java-
\nbased stock market.<\/p>\n
Hindarmojo Hinuri K., an SSX director, said here on Monday
\nthat the exchange's management had formally asked shareholders to
\ninject Rp 27 billion (about US$2.5 million) in additional funds
\nto keep the exchange afloat.<\/p>\n
\"That is one of the three options that have been forwarded to
\nshareholders to deal with the exchange's financial difficulties,\"
\nhe told The Jakarta Post.<\/p>\n
The second option is to continue the operation of the bourse
\nusing existing financial resources. He refused to reveal the
\nthird option which he described as being very conservative.<\/p>\n
The SSX, the country's second stock exchange after the Jakarta
\nStock Exchange, has suffered acute financial problems since the
\neconomic crisis hit the country in late 1997.<\/p>\n
The management had been engaged in massive cost-cutting
\nmeasures to allow the exchange to continue its operations but the
\ncontinued slowdown in the local stock market has resulted in
\nfurther income losses, Hindarmojo said.<\/p>\n
He said that the daily transaction volume on the stock
\nexchange was only about Rp 10 billion at present, far lower than
\nthe original projection of Rp 60 billion.<\/p>\n
With the sharp drop in transactions, the exchange has to rely
\nsolely on listing fees to maintain its operations.<\/p>\n
\"Although we receive stable listing-fee income of about Rp 100
\nmillion per month, this is still far from enough to cover
\noperating expenses and salaries,\" Hindarmojo said.<\/p>\n
He said that the shareholders would soon meet to decide what
\naction could be taken to cope with the exchange's losses.<\/p>\n
The Surabaya stock exchange, which is equally owned by its 23
\nstockbroking companies, started to operate in the late 1980s as
\nthe country's first private stock market. (hen\/nur)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/ssx-faces-closure-as-financial-woes-worsen-1447893297",
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