JSX urges brokers to use new trading facilities

Rendi A. Witular, Jakarta

The Jakarta Stock Exchange (JSX) warned securities firms that are members of the bourse to begin using new remote trading facilities by the end of 2005, in a bid to improve trading efficiency.

JSX president director Erry Firmansyah said the use of the remote trading facilities would be mandatory for securities firms, and the failure to comply with the order would result in sanctions.

"We have not decided on the sanctions yet. But for sure, securities firms, local and overseas-based, are obliged to use the facilities," Erry said on Wednesday.

He said that with the facilities, securities firms would not have to place brokers on the JSX trading floor because they would be able to conduct trading activities online in real-time at their offices or homes.

Since the launch of a pilot project for the remote trading facilities on March 28, 23 securities firms have agreed to use the facilities. The JSX will invite 25 other securities firms to use the facilities in January, 30 firms in April, 35 firms in July and the remaining firms in November.

The JSX has invested as much as US$1.8 million to install the facilities, with a return on the investment expected to be generated from fees paid by the securities firms.

Erry refused to disclose the amount of the fees.

Several local and foreign-based securities firms have refused to use the facilities due to the expenses and fear of malfunctions.

However, Erry guaranteed the facilities would be trouble-free, saying the bourse had appointed Ernst & Young to audit the facilities for possible errors and malfunctions.

"Aside from the audit, the JSX has also protected itself from any claims resulting from the facilities with insurance," said Erry.

To anticipate any disturbances in the remote trading facilities, the JSX will provide securities firms with the option of also placing brokers on the trading floor, he said.

Eyebox

Seven firms to enter IPOs

The president director of the Jakarta Stock Exchange, Erry Firmansyah, said seven firms would go public with initial public offerings (IPOs) in October and November.

"The seven firms going for IPOs comprise three local securities firms, one retail firm, one tire firm and two manufacturing firms," said Erry.

The JSX initially projected that 20 new firms would be listing their shares on the bourse. -- JP