DUBAI: Kuwait’s Capital Markets Authority (CMA) has rejected an appeal by Bahrain-based Gulf Finance House (GFH) against the regulator’s decision to monitor its Kuwait-listed shares, the investment firm said on Monday.

The CMA decided to monitor the stock after it was traded in high volumes ahead of a company disclosure last year. GFH, which said the events were unrelated, appealed last month.

However, the CMA commissioner board, which met at the end of May, “reviewed the details of the subject and has maintained the CMA’s previous decision in this respect”, GFH said in a bourse statement without elaborating.

In recent months, Kuwait’s regulator has been clamping down on what it sees as unusual market activity. Some executives and analysts have welcomed the move but others say the watchdog is being heavy-handed.

The CMA noticed GFH stock traded in high volumes in May 2013, before Bahrain’s Khaleeji Commercial Bank, an associate of GFH, signed an agreement with Bank Al-Khair to study a possible merger.

GFH has said there was no relation between the memorandum of understanding (MoU), signed on May 30, and high trading volumes witnessed on May 19-21.

The merger plans were scrapped in March this year after the two Islamic banks failed to agree on the structure and valuationof the deal.