KASE Board of Directors approved its new internal document - Method of calculation of weighted average yield rate for debt securities

/KASE, September 24,10/ - By KASE Board of Directors' decision of September 23, 2010, KASE's new internal document- "Method of Calculation of Weighted Average Yield Rate for Debt Securities" (the Method) - was approved. The Method has been submitted to the Agency of the Republic of Kazakhstan on Regulation and Supervision of Financial Market and Financial Organizations (FSA) and will be effective upon KASE Board of Directors' separate decision. The Method has been developed in order to comply with regulations of Decree of the Board of FSA "On introduction of changes and additions into some regulatory legal acts of the Agency of the Republic of Kazakhstan on Regulation and Supervision of Financial market and Financial Organizations on Issues Regarding Activities of Pension Assets Management Organizations and Evaluation of Financial Instruments, contained in Investment Portfolio of the Pension Accumulative Funds" of July 15, 2010 # 105 (Decree), which was registered in Register of State registration of regulatory legal acts on August 23, 2010 under # 6413 and is effective from September 6, 2010. The Decree introduces changes and additions (Amendments) to Rules of Evaluation of Financial Instruments, contained in Investment Portfolio of the Pension Accumulative Funds approved by Decree of the Board of the Agency of the Republic of Kazakhstan on Regulation and Supervision of Financial Market and Financial Organizations of March 26, 2005 # 109. The Amendments stipulate weekly publication on KASE web-site of data on the fair value of illiquid debt securities issued by organizations - residents of the Republic of Kazakhstan and included into KASE official list. At the same time illiquid debt securities are defined by the Amendments as securities, whose market price cannot be calculated in accordance with KASE's internal document "Methodology of Securities Valuation" due to absence of parameters for such valuation. In accordance with the Amendments, the fair value of illiquid debt securities is calculated as a bond price derived from its yield to maturity ratio provided that the so-called discount rate is used as yield. In accordance with Decree, discount rates "are defined by KASE Board of Directors once a year "for every single category (sub-category) of Exchange official list's Debt Securities section, based on annual weighted average rate in the respective Exchange official list's category (sub-category) by calendar year results". The mentioned decision is subject to approval by FSA. The method establishes the procedure of calculating weighted average yield rates for securities of a category (sub-category) of a section of KASE official list for a given period with the purpose of: - enabling KASE Board of Directors to fix discount rates in accordance with Rules of Evaluation of Financial Instruments, contained in Investment Portfolio of the Pension Accumulative Funds approved by Decree of the Board of the Agency of the Republic of Kazakhstan on Regulation and Supervision of Financial Market and Financial Organizations of March 26, 2005 # 109; - with other purposes provided for in KASE internal documents. The Method will be published on KASE web-site in the nearest time. [2010-09-24]