Members Contribution Fund (MCF) Trust
Formerly, Lahore Stock Exchange Limited (LSE) established the Members Contribution Fund (MCF) Trust in October-1997. The objective of the establishment of the MCF Trust was to make payments to clearing house of the Exchange to satisfy the clearing house related obligations of the Members of the Exchange in case of default of such Member to provide comfort to the investors.
Subsequently, after establishment of the National Clearing Company of Pakistan Limited (NCCPL), the obligations of the clearing house were transferred to NCCPL. Accordingly, to meet the obligations of the Members/TREC holders towards NCCPL, a bank guarantee was provided to Settlement Guarantee Fund (SGF) Trust of NCCPL.
In August-2006, with the approval of SECP, the Trust Deed of the MCF Trust was executed and registered with the registrar concerned under Trust Act, 1882. Subsequently, the Trust was registered under the newly implemented ‘Punjab Trust Act, 2020’.
In the year 2015, under the second phase of the Stock Exchanges Act, 2012, the three stock exchanges were entered into the Scheme of Integration, which was executed by January 11, 2016 under the Integration Order (SECP Order No. 1/2016) of the Commission. The Commission issued the amended Stock Exchanges (Corporatization, Demutualization and Integration) Regulations, 2012 dated, December 17th, 2015.
Under these Regulations, the Commission constituted the Funds Committee for LSE (replacing LSE) in a supervisory role to oversight of the Trust Funds of LSE and also nominated Members of the Committee. The Trust Deeds of respective Trust Funds were amended as per direction of the Commission under the above referred Regulations. The Trust Deeds, included the terms and conditions, bylaws of the Trusts. The composition of the Trustees of respective Trust Funds was also amended as per the Regulations and the Commission also appointed the new Trustees of respective Trust Funds.
The Trust is entertaining all the claims of the cases against the defaulted Members/TREC holders of erstwhile LSE prior to the date of Integration i.e., January 11, 2016 as well as the claims against the Ex-TREC holders of erstwhile LSE inducted by Pakistan Stock Exchange (PSX) relating the post Integration period. Accordingly, to comply the requirement of Settlement Guarantee Fund of National Clearing Company of Pakistan Ltd. (NCCPL), Trust has provided bank guarantee against the TREC holders of erstwhile LSE.