SET wants more from Finansa on debenture sale
The Stock Exchange of Thailand has asked Finansa Plc to further explain why it sold Bt298.5 million worth of debentures issued by BFIT Securities a mere two months after buying them.
The call came after the SET learned that Finansa had bought BFIT's bonds on October 4, 2004 and unloaded them in December. The stock exchange has asked Finansa to also identify the buyers and which of its executives was responsible for pulling the trigger on the sale.The transaction occurred at the same time as its subsidiary Finansa Credit was submitting an application with the Bank of Thailand to establish a commercial bank by merging with Bangkok First Investment and Trust Plc. The application went nowhere and the planned merger eventually collapsed. The SET gave Finansa until March 8 to submit its clarification on the debenture transaction. "The SET requires Finansa to explain the profit from the mentioned transaction and the reason Finansa invested in it for less than two months. Finansa is required to clarify the sales procedure, its process in connecting and selecting debenture purchasers and state the name of its executive who contacted this group of purchasers," the SET's statement said. Finansa must explain the responsible executive's scope, authority and the maximum size of transactions the executive has the authority to approve. The company must also divulge the transaction amount that its board of directors is authorised to approve. Earlier, the company said it sold the debentures because it could make a reasonable return. The company recently stated that the transaction was within the authority of its executives and that it did need approval by the board. It also said that the SET should instead ask BFIT Securities for the information so that it could receive correct and complete documentation of the deal. "Finansa is in the position that it should know all of such information because Finansa invested in the debenture," the SET shot back. The bourse added that Finansa had a duty to transparently disclose the information to the SET and its shareholders. The Nation
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