PSE Finds 4 More Shari’ah-compliant Securities

Amidst the height of CoViD-19 lockdowns and quarantine measures around the country, the Philippine Stock Exchange (PSE) found 52 securities to be compliant with the principles of Islamic finance as of March 25, 2020, as indicated in PSE’s website. This number of Shari‘ah-compliant firms shows an increase of four firms, compared to the 48 firms that were listed during the previous review.

This new list of Shari‘ah-compliant firms issued by the PSE included six new entities, while two securities which are both related to ATN Holdings, Inc., had been removed. The six new entrants are Axelum Resources Corporation; IPM Holdings, Inc.; ISM Communications Corporation; ItalPinas Development Corporation; Pacifica Holdings, Inc.; and Zeus Holdings, Inc.

As a measure to attract Muslim investors inside and outside the country, the PSE carries out quarterly evaluation of its listed Shari‘ah-compliant entities in order to ensure compliance with the Accounting and Auditing Organization for Islamic Finance Institutions (AAOIFI).

In order for a company to be listed as a Shari‘ah-compliant entity, it must have less than 5% of its revenues generated from businesses in conventional interest-based lending, financial institutions, pork, alcohol, intoxicants, tobacco, arms and weapons, gambling, casinos, derivatives, adult entertainment, music and human stem-cell research. In addition, its cash or interest-bearing deposits shall not reach more than 30% of the company’s market capitalization while accounts receivable must be lower than two thirds of its market capitalization.

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