Head of the securities division in the Cairo Chamber of Commerce, Misr for Central Clearing Depository and Registry (MCDR) Awny Abdel Aziz rejected a request from the Egyptian Capital Market Association (ECMA) to reduce the fees obtained by MCDR for settling selling and buying operations using T+1 and T+0 mechanisms.
ECMA requested a reduction in the fees on all operations carried out using the two mechanisms, in which the ratio of 1/8 in a thousand per operation would be reduced to 1/16 in a thousand.
Abdel Aziz said the reason for the rejection is that MCDR puts a maximum limit of EGP 5,000 for the fees it obtains from each operation, which means that there is a limit. Moreover profits of MCDR have significantly dropped to less than EGP 500m per session due to the decline of trading volume.
MCDR has not revealed any details about its financial performance in 2015 yet however it recorded net profit of EGP 65.8m in 2014 compared to EGP 33.3m in 2013.
T+1 is a settling mechanism that allows investors to sell shares the next day after they buy them. While the T+0 mechanism is an instantaneous settling mechanism that allows trading securities using the system of buying and selling in the same session.
The Ministry of Investment has not responded to the request made by ECMA to approve on distributing part of the profits from the Investor Protection Fund against non-commercial risks on members of the fund.
Abdel Aziz said that members of the fund, whether brokerage companies, fund management, or financial portfolio management, are facing major declines in revenues due to the decline in the size of stock exchange trading volumes, which requires the provision of liquidity from other sources like the investor protection fu
