Stock Exchange Of Thailand Concludes There Was No Manipulation In SCIB-C1 Trading

Executive Vice President of The Stock Exchange of Thailand (SET) Mrs. Patareeya Benjapolchai revealed that the SET has investigated the trading of Siam City Bank Pcl.’s securities (SCIB) and its derivative warrants (SCIB-C1) during August 9 –13, 2004, and concluded that:

1. The prices of SCIB-C1 moved in accordance with its underlying security SCIB as the exercise price of SCIB-C1 was at THB 20.85. Thus, when the price of SCIB decreased, that of SCIB-C1 similarly decreased and became volatile.
2. The prices of SCIB and SCIB-C1 both declined in line with the then-current market conditions, in which the overall banking sector was affected by several factors.
3. The overall market was in a decline after the SET Index moved down to 595.60 points, and this caused heavy selling on many securities, especially those in the banking sector. The prices of the securities in the banking sector, including SCIB, thus declined.
4. The trading of SCIB-C1 on August 11 and 13, 2004, was found to be highly speculative. There were more than 3,000 investors trading the securities, with a scattered pattern of orders. Of these orders, more than 50% were traded on the net settlement basis.
5. The initial top 30 traders in SCIB-C1 collectively contributed to less than 25% of all trading turnover in this security. The biggest player traded 2.11% of the security’s turnover. Within each time period during which prices changed over a wide range and trading might have been subject to price manipulation, it appears that trading by the largest investor in each period was found insignificant compared to the overall trading in that security.

Therefore, the SET concluded that trading could not be documented as a case of manipulation. The SET has already submitted the investigation results to the Securities and Exchange Commission (SEC).