The US Securities and Exchange Commission (SEC) has delayed its decision to rule on Nasdaq’s compensation payout plan for companies affected by problems during Facebook’s IPO.
The US Securities and Exchange Commission (SEC) has delayed its decision to rule on Nasdaq’s compensation payout plan for trading companies affected by problems during Facebook’s much-hyped IPO.
The SEC said in a regulatory filing this week that Nasdaq's $62 million (£39 million) payout plan for investment banks affect by technical problems during the IPO has been moved back in order to allow the authority to consider new comments made by the stock exchange group since the last deadline extension.
The SEC is seeking an additional 60 days to make a final ruling, meaning the deadline will now be pushed back from 28th January to 29th March.
Facebook’s IPO in May 2012 encountered problems when share trading was delayed for 30 minutes due to glitches in Nasdaq’s auction process software during the build up to the launch of trading stock. This left many traders unaware of their position on whether orders had been placed, with an estimated 30 million shares' worth of trading affected.
The troubled IPO led to claims from investment banks such as Citigroup and UBS that they had suffered substantial losses running into the hundreds of millions.
Initial offers of $40 million (£25 million) compensation were roundly attacked by those affected, and an increased compensation payment plan from Nasdaq is now being considered by the SEC.
SEC has also warned in the past that it could force Nasdaq to upgrade its systems as a result of the glitches during the IPO for the social networking site.