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Debt Securities

Why issue your Debt securities on PSX?

Our Debt Market can help issuers to finance their long-term growth. We help private or public, listed or non-listed, SMEs or large cap firms to raise funds through Debt Listing.

Debt Listing can be a very flexible way of raising capital. It can offer a way of stabilizing your company’s finances by having substantial debts on a fixed-rate interest. This offers some protection against variable interest rates or economic volatility. Other advantages of Debt Listing can be:

Access to large pools of capital by numerous investors who invest on PSX
Effective and affordable way of raising capital to fund growth
Liquidity created by listing debt securities enables companies to raise long term debt securities as individual investors may exit when they require cash flow. Listed debt securities are, therefore, issued at a lower interest rate as liquidity risk is significantly reduced
By listing debt of a company to raise capital, the equity of the company is not diluted.

Types of Debt Listing

Publicly Issued Debt Listing

Listed on Pakistan Stock Exchange (PSX). Can be offered to the general public as well as institutional investors.

Privately Placed Debt Listing

Listed on Pakistan Stock Exchange. Can only be offered to and traded by QIBs (Qualified Institutional Buyers) such as banks and other financial institutions.

Business Eligibility

Business Operation Status	Issuer has commenced commercial operations	Issuer has commenced commercial operations
	Publicly Issued Debt Listing	Privately Placed Debt Listing
Approval	SECP approves issuance of debt security	The issuer is authorized by its Memorandum of Association to issue debt security
Paid Up Capital	PKR 200 million or above	PKR 25 million or above
Total Issue Size	PKR 200 million or above	PKR 25 million or above
Instrument Rating	For long term debt security (Issued for more than a year), the instrument rating is not less than BBB+	For long term debt security (Issued for more than a year), the instrument rating is not less than BBB+
Instrument Rating	For short term debt security (Issued for less than a year) the instrument rating is not less than A2	For short term debt security (Issued for less than a year), the instrument rating is not required if the issuer is rated not less than BBB
Number of Subscribers	No Limitation	Number of initial subscribers shall not be less than 5
Other Conditions	Issuer shall not be allowed to issue if any of its securities is on the Defaulter’s Segment of the Exchange	1. Issuer shall not be allowed to issue if any of its securities is on the Defaulter’s Segment of the Exchange 2. The debt security is redeemable and has the option of conversion into ordinary shares.

PSX Listing Fees

Initial Listing Fees- a one-time fee payable at the time of the debt security listing.

Annual Listing Fees- payable annually by a company calculated on the basis of total issue size of the debt security

Initial Listing Fees	0.075% of the total issue size of the Debt Security	0.075% of the total issue size of the Debt Security
	Publicly Issued Debt Listing	Privately Placed Debt Listing
Initial Listing Fees Cap	PKR 3 million	PKR 1.5 million
Annual Listing Fees	0.075% of the total issue size	0.075% of the total issue size
Minimum Annual Listing Fees	PKR 100,000	PKR 50,000
Annual Listing Fees Cap	PKR 1 million	PKR 750,000

Procedure to List

Selecting the right Consultant is one of the most important steps to raise financing in the public capital markets.
It is advised to meet more than one Consultant to determine which ones have the appropriate experience and understanding of your business model. You should define a realistic timeline with your Consultant.
When signing a mandate with a Consultant, make sure to negotiate fees with them and clarify responsibilities in advance.
You will have to hire a Debt Securities Trustee who would be responsible for securing the interest of the debt securities holders.

You will need to designate the Company Secretary or any other officer from your company as Compliance Officer.
He would be responsible for ensuring that the regulations are followed and for preparing status report for your Board, PSX and the Trustee.

A Prospectus needs to be created and submitted by the Consultant for approval by PSX and SECP. An Information Memorandum will be created in case of Private Placement.
The Issuer submits Form-I to the Exchange along with the documents/information as mentioned in Annexure-I of Chapter 5B of PSX rule book.
In case of Private Placement, the company will finalize list of subscribers and then apply to the Exchange by submitting Form-I along with the documents and information as mentioned in Annexure-I.
The company shall pay an initial and annual listing fee to PSX.

PSX provides approval of listing of the debt security subject to the approval of SECP.
The approval from PSX would be completed within 15 days from the date of complete submission of document.

After the approval, the debt security is formally listed. Trading starts the next day on BATS (Bonds Automated Trading System).
Exposure on the market can be very different from previous practice for most companies. For instance, publishing an annual report and disclosing material information to the market are two key continuing obligations for listed companies.

1 Hire a Consultant & a Trustee

Selecting the right Consultant is one of the most important steps to raise financing in the public capital markets.
It is advised to meet more than one Consultant to determine which ones have the appropriate experience and understanding of your business model. You should define a realistic timeline with your Consultant.
When signing a mandate with a Consultant, make sure to negotiate fees with them and clarify responsibilities in advance.
You will have to hire a Debt Securities Trustee who would be responsible for securing the interest of the debt securities holders.

2 Designate a Compliance Officer

You will need to designate the Company Secretary or any other officer from your company as Compliance Officer.
He would be responsible for ensuring that the regulations are followed and for preparing status report for your Board, PSX and the Trustee.

3 Prepare and Submit an Application

A Prospectus needs to be created and submitted by the Consultant for approval by PSX and SECP. An Information Memorandum will be created in case of Private Placement.
The Issuer submits Form-I to the Exchange along with the documents/information as mentioned in Annexure-I of Chapter 5B of PSX rule book.
In case of Private Placement, the company will finalize list of subscribers and then apply to the Exchange by submitting Form-I along with the documents and information as mentioned in Annexure-I.
The company shall pay an initial and annual listing fee to PSX.

4 Approval of Application

PSX provides approval of listing of the debt security subject to the approval of SECP.
The approval from PSX would be completed within 15 days from the date of complete submission of document.

5 Formal Listing

After the approval, the debt security is formally listed. Trading starts the next day on BATS (Bonds Automated Trading System).
Exposure on the market can be very different from previous practice for most companies. For instance, publishing an annual report and disclosing material information to the market are two key continuing obligations for listed companies.

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We want to hear from you - Submit Interest

Whether you are just gathering information for a possible IPO or Debt Listing in the future, or you are actually planning or preparing for an IPO or Debt Listing, the Business Development team of PSX is here to offer assistance.

If you have already begun preparations for an IPO or Debt Listing but want to hear from PSX directly, our team is here for you to consult with. We are ready to answer any questions regarding Debt Listing or listing of your company. If you want to know about our system and rules for IPO or Debt Listing such as listing criteria or if you are curious to know what you should do to prepare for an IPO or Debt Listing, please feel free to contact us through our website or by phone.

We also have staff available to visit prospective applicants and provide hands-on explanations of the listing process.