Frequently Asked Questions (FAQs)Share
Suspension of trading is where the buying and selling activity in the shares of a company is put on hold.
The suspensions were as a result of failure to meet their continuing listing obligations including reporting of financial statements.
The suspension of trading in the shares of the ACI, CLYD, GWEB, PKL and TRASOL was imposed on August 28, 2017. CPC’s suspension was effective August 30, 2017.
The suspension of trading in the shares of:
CLYD and TRANSOL were lifted on August 28, 2017; and that of PKL was lifted on September 11, 2017. The suspension of trading in the shares of CPC is still in force.
The suspensions were lifted after the companies rectified all the breaches that led to the suspension.
If the infractions are repeated, a suspension in trading can be re-imposed or further sanctions applied.
The companies that rectified all the anomalies did not have further sanctions imposed on them.
There was no further punishment imposed on the companies. The GSE Rules as it exist now does not have fines for such infractions.
When a company’s listing status is suspended, it means trading in the shares of the company cannot take place and in addition dealers cannot sponsor any corporate actions of the company on the market.
When the company fails to comply with the continuing listing obligations of the Exchange after reminders, the listing status could be suspended to elicit compliance and market discipline and ultimately, boost investor confidence in the market.
In suspension of trading, trading in the company’s shares are put on hold and in suspension of listing status while shares cannot be traded, dealers are also not permitted to sponsor any corporate action of the company.
The purpose is to elicit compliance from the company concerned and ultimately deepen public confidence in the market.
Rule 13 of the GSE’s Listing Rules spells out the conditions under which a company's listing status could be suspended.
The Exchange notifies the company in writing, gives an opportunity for the company to rectify the breach(es) and specifies a period of time within which the company must eliminate the grounds for the suspension of listing.
Where the Exchange has reasonable grounds to believe that it is not possible to eliminate the grounds for suspension of listing, the Exchange shall then issue an order to suspend the listing status of the company.
The suspension of lifting status of a company is lifted when the company rectifies all the breaches that led to the suspension
Yes, suspension of trading and/or suspension of listing status of companies have some effect on prospective investors. During the period of suspension, an investor is unable to trade (buy or sell shares) in the company. On the other hand this force the company to provide the needed information to enable investors take appropriate and informed investment decisions.
In the Exchange’s earlier Press Release that suspended these companies, the companies were given a deadline to submit their financials or face further sanctions. These companies have not met those conditions of submitting all the outstanding financials and other obligations; therefore the next level of higher sanctions, being suspension of listing status has been imposed.
With the suspension of the listing status of these companies, there will be no trading activities in the shares of these companies and dealers will not be permitted to sponsor any corporate actions of these companies.
When the companies provide the information required or rectify the breaches that led to the suspension.
The next line of sanction could be applied and that next line of action is compulsory de-listing.
ACI has rectified some of the infractions, not all.
Management of CPC has met with the Management of the Exchange to share their concerns and challenges. However, the duty of provision of information to the investing public is paramount, so the challenges notwithstanding, the position of the Exchange is that investors need to have the information.
GWEB has rectified some of the infractions, not all.
Rule 13(4) (a) of the GSE Listing Rules states that when a company ceases to be an operating company, the company should be compulsorily delisted and the Exchange has taken the decision to proceed with the de-listing of UT Bank Ltd.
UT Bank Limited would be taken off the Official List of the Exchange in September 2017.
The Fund Managers and Trustees made investments decisions in UT based on analysis of market risks.
Like all equity investors when receivers are appointed for a company in distress, their recourse is the Receivers. Retail investors may contact the Receivers in respect of any concerns they may have.
Prospective entrepreneurs should remind themselves of the fact that in listing to get the benefits such as the ability to raise capital and the reputation that comes with having their entities listed, they also have a duty to the market and investors in general to provide them with price-sensitive information and by so doing boost investor confidence in the market.
Investors, local and international, should take comfort in the fact that the market will extract discipline from listed companies in respect of continuing listing obligations and that should improve investor confidence in the Ghanaian capital market.
The point of contact are the Receivers who have been appointed, (Messrs. Vish Ashiagbor and Eric Nipah, c/o PricewaterhouseCoopers, Ghana). Effectively, they are the directors of UT Bank now.