Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


FMA plans to beef up transparency on stock exchange

FMA plans to beef up transparency on stock exchange

By Paul McBeth

Feb. 28 (BusinessDesk) - The Financial Markets Authority says improving levels of transparency on New Zealand's stock exchange is one of four major areas it will keep tabs on this year as the government's partial privatisation programme steps up a gear.

New Zealand's securities watchdog was unimpressed by "poor administrative practices by substantial shareholders, directors and officers, resulting in delays in notifying the market of trading" and has concerns about "a lack of focus on obligations to investors by some issuers and their directors," it said in its compliance focus for this year.

"Areas of particular concern are the inadequate handling and disclosure of conflicts of interest and disclosure of business changes," it said.

The note comes after the Supreme Court gave the green light for the government to embark on its sell-down of MightyRiverPower in the first of the Crown's planned mixed ownership model. The proposal to partially sell several state-owned assets is being touted as the government's way to revive a flagging capital market and attract retail investors still burning from the 1987 stock market crash.

The government also expects increased disclosure requirements to sharpen up the performances of the partially-privatised companies, an issue which is gaining more attention after state-owned coal miner Solid Energy's rapid decline towards insolvency.

The FMA plans to focus its compliance monitoring efforts on building customer trust, raising standards in existing regimes, embedding new regimes, and KiwiSaver. It will also keep a wary eye on the Canterbury rebuild and how capital is raised and insurance funds are invested.

“Signalling our focus for 2013 makes sense. It provides an opportunity for participants to assess their activities and take the necessary steps to improve compliance in these areas,” chief executive Sean Hughes said in a statement.

“Priorities will evolve as we monitor financial markets and evaluate emerging risks, but we’re anticipating that these themes will remain beyond 2013,” he said.

The note comes in a year when the country's decades-old securities law is set to be replaced with the Financial Markets Conduct Bill slowly weaning its way through Parliament. The rewrite of legislation aims to improve the level of company disclosure and revive investor confidence after the collapse of the finance companies through the latter half of the 2000s.

The watchdog wants particular care to be paid to retirees, who may be seeking higher yielding investments, but are less able to recover from losing their capital.

"FMA expects participants to take into account the vulnerability of these customers when advising on, or delivering financial products," it said.

The watchdog gave a serve to futures dealers, saying initial visits to authorised dealers found some firms have "poor compliance controls in place for meeting capital requirements and safeguarding client money and assets, and also indicated a lack of robustness in the work undertaken by external reviewers."

Dairy futures are already traded on the NZX, and equity derivatives have been slated for trading in May this year.

The regulator will also monitor property related investments, which "may be higher risk than they seem."

The FMA's predecessor organisation, the Securities Commission, was criticised for not taking action against property investment group Blue Chip claiming it wasn't covered by the Securities Act.

The Supreme Court has since ruled that is was covered by the legislation, and the FMA is still considering whether to pursue Blue Chip.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Sky City : Auckland Convention Centre Cost Jumps By A Fifth

SkyCity Entertainment Group, the casino and hotel operator, is in talks with the government on how to fund the increased cost of as much as $130 million to build an international convention centre in downtown Auckland, with further gambling concessions ruled out. The Auckland-based company has increased its estimate to build the centre to between $470 million and $530 million as the construction boom across the country drives up building costs and design changes add to the bill.
More>>

ALSO:

RMTU: Mediation Between Lyttelton Port And Union Fails

The Rail and Maritime Union (RMTU) has opted to continue its overtime ban indefinitely after mediation with the Lyttelton Port of Christchurch (LPC) failed to progress collective bargaining. More>>

Earlier:

Science Policy: Callaghan, NSC Funding Knocked In Submissions

Callaghan Innovation, which was last year allocated a budget of $566 million over four years to dish out research and development grants, and the National Science Challenges attracted criticism in submissions on the government’s draft national statement of science investment, with science funding largely seen as too fragmented. More>>

ALSO:

Scoop Business: Spark, Voda And Telstra To Lay New Trans-Tasman Cable

Spark New Zealand and Vodafone, New Zealand’s two dominant telecommunications providers, in partnership with Australian provider Telstra, will spend US$70 million building a trans-Tasman submarine cable to bolster broadband traffic between the neighbouring countries and the rest of the world. More>>

ALSO:

More:

Statistics: Current Account Deficit Widens

New Zealand's annual current account deficit was $6.1 billion (2.6 percent of GDP) for the year ended September 2014. This compares with a deficit of $5.8 billion (2.5 percent of GDP) for the year ended June 2014. More>>

ALSO:

Still In The Red: NZ Govt Shunts Out Surplus To 2016

The New Zealand government has pushed out its targeted return to surplus for a year as falling dairy prices and a low inflation environment has kept a lid on its rising tax take, but is still dangling a possible tax cut in 2017, the next election year and promising to try and achieve the surplus pledge on which it campaigned for election in September. More>>

ALSO:

Job Insecurity: Time For Jobs That Count In The Meat Industry

“Meat Workers face it all”, says Graham Cooke, Meat Workers Union National Secretary. “Seasonal work, dangerous jobs, casual and zero hours contracts, and increasing pressure on workers to join non-union individual agreements. More>>

ALSO:

Get More From Scoop

 
 
Standards New Zealand

Standards New Zealand
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news