By Keren Concepcion G. Valmonte
THE Philippine Stock Exchange (PSE) suspended on Thursday the trading of shares in Abra Mining and Industrial Corp., which the market operator found to be selling stocks beyond the number of its listed shares.
Along with the Philippine Depository & Trust Corp. (PDTC), the exchange found the mining company to have violated three rules based on its disclosures and reports.
The number of Abra Mining’s fully paid issued and outstanding shares exceeded its listed shares, violating a PSE guideline that requires all fully paid issued and outstanding shares be listed.
Lodged PDTC shares are also more than the company’s listed shares. All lodged securities for trading with the PDTC should have been approved first.
Abra Mining’s shares with the PDTC are also more than above the number of issued and outstanding shares in the company’s audited financial statements. Shares that have not been accounted for are being traded, which is a violation of the Revised Corporation Code.
As a result, Abra Mining has been suspended from trading at the Philippine market beginning 9 a.m. on Thursday, March 4.
“The exchange, in close coordination with the Securities and Exchange Commission, has decided to suspend the trading of AR (Abra Mining’s stock symbol) shares until the above matters are satisfactorily resolved by the company’s directors, officers, corporate secretary, and its stock and transfer agents, Asian Transfer & Registry Corp.,” the PSE said.
Analysts said they expect Abra Mining to correct the reported errors.
“AR would have to explain and/or rectify the faults seen by the exchange. Until they do so, [their] stock price would remain suspended,” COL Financial Group, Inc. Chief Technical Analyst Juanis G. Barredo said in a Viber message on Thursday.
Abra Mining shares were last traded at the exchange on Wednesday, closing at P0.0046 apiece, with a 52-week high of P0.013 per share.
“This may keep shareholders pinned in the stock and unable to liquify their holdings until the stock can once again be traded,” Mr. Barredo added.
Regina Capital Development Corp. Head of Sales Luis A. Limlingan pointed out the possibility that regulators may have also been at fault.
“Perhaps, it’s more a reflection of how this discrepancy got passed the regulating bodies and how [they are] going to safeguard the interests of the public moving forward,” Mr. Limlingan said in a Viber message.
However, he said that it was also hard to predict if this case would prompt the regulators to update their rules and regulations.
“It depends on whether this was a human error or because of a loophole in the guidelines. If former no, but if [it’s the] latter, I would think yes,” Mr. Limlingan noted.
The PSE will be providing further updates on the case should there be developments.
Abra Mining could not be contacted for comment as of press time.