Three securities houses get margin trading permit

JAKARTA (JP): The Jakarta Stock Exchange (JSX) has licensed three securities companies -- PT Putra Saridaya Persada, PT Anekareksa Securities and PT Panin Securities to start margin trading.

JSX trading director Mas Achmad Daniri said over the weekend the companies had met the Capital Market Supervisory Agency's margin trading requirements.

He said the companies had strong back office administrative activities, and standard accounting principles.

Each of the firms has more than Rp 10 billion (US$3.84 million) in working capital, he said.

Daniri said 10 other securities companies were applying for margin trading licenses.

Of the 272 stocks listed on the JSX, only 143 can be traded with margin facilities, and only five can be traded with short- selling positions.

The 143 include Aneka Kimia Raya, Asahimas Flat Glass, Alumindo Light Metal Industry, Bank Negara Indonesia, Bakrie brothers, H.M. Sampoerna, Telkom, Indocement, Matahari Putra Prima, Gudang Garam, Dynaplast, Hero Supermarket.

"The five stocks which can be sold short are PT Alumindo Light Metal, Bank Niaga, Citatah Indah, Sierad Produce and PT Telkom," the JSX said.

A broking company has to have a net adjusted working capital of at least Rp 5 billion (US$1.92 million) to carry out margin trading.

The Capital Market Supervisory Agency says this requirement is necessary to ensure broking house have enough funds to provide their clients with fair margin trading facilities.

Investors involved in margin trading have to open margin accounts with their brokers, have net assets of at least Rp 1 billion and an annual income of at least Rp 200 million.

Margin traders also have to deposit cash or shares worth at least 50 percent of the value of shares traded. (aly)