Shura Council calls on CMA to find market maker to ensure liquidity, supply-demand balance

Logo of the Capital Market Authority (CMA)

Saudi Arabia’s Shura Council called on the Capital Market Authority (CMA) to work on finding one or more market makers to provide liquidity and ensure balance of supply and demand in the stock market.

The council’s decision came after the review of the Financial and Economic Committee’s report on the CMA's annual report for fiscal year 2021/22, the Saudi Press Agency reported.

The council also heard the committee members' observations and opinions on the report.

The CMA was also asked to review the mechanism for determining the subscription price of REIT units in the Saudi market, by adopting a book-building mechanism for pricing similar to joint stock companies.

The council also required the market regulator to find a mechanism, in coordination with the relevant authorities, to oblige joint stock companies to deposit certificates of shares, subscription surplus and reserved profits that were not deposited in the portfolio. This should be ensured through tracing and communicating with the shareholders.

The CMA also needed to control and deal with irregularities in a timely manner, in order to correct the course of the violating investors and prevent the accumulation of violations.

Meanwhile, the Shura also called on the CMA to review the investment terms in the parallel market, to allow more investors and to facilitate the procedures and rules for investing in bonds and instruments.