The four Malaysian capital market forces that motivate


Kuala Lumpur, May 07, 2018 (GLOBE NEWSWIRE) – Capital markets are like networks – where institutions, investors and fundraisers are connected through various mechanisms. Each network has its objectives, whether it be effectiveness, efficiency or size.

According to Bursa Malaysia CEO Tajuddin Atan, Malaysia’s exchange holding company has a bigger focus, “Bursa Malaysia’s goal is to serve the nation’s economic growth potential in an integrated manner and collaborative – building on the government’s economic policies while balancing economic conditions, the needs of Malaysian businesses of all sizes and the positioning of the Malaysian capital market in the eyes of the global investment community.

This balance comes from four forces at play: 1) Helping Malaysian companies (some of which are well known names in ASEAN) to go global; 2) Build a strong core of Malaysian SMEs, the next growth engines (especially those operating within the new economy); 3) Growing participation of investors of all sizes and development of international references; 4) And in doing so, through innovations in Islamic capital market leadership, Crude Palm Oil Futures (FCPO) and the sustainability agenda.

“These four forces fuel the economy, while ensuring broad participation that creates sustainable, widespread and equitable growth,” Tajuddin said.

Globalization of Malaysian companies

Bursa Malaysia has a solid foundation. Its market capitalization increased by 185.6% from January 2009 to the end of March 2018. During the same period, in terms of funds raised in the primary and secondary markets, Malaysia leads with US $ 61.96 billion. compared to other emerging ASEAN markets.

In 2017, net inflows of foreign funds into the equity market amounted to US $ 2.46 billion, well ahead of the region (Vietnam + US $ 1.01 billion, Philippines + US $ 1.1 billion, while Indonesia and Thailand recorded net outflows).

Malaysia’s equity market also has the largest number of listed companies with 906, ahead of Singapore (745), Vietnam (737), Thailand (691), Indonesia (569) and the Philippines (267) at end of March 2018.

Tajuddin believes that this recognition by funds, both local and foreign, has supported the creation of regional champions and global players – known names such as AirAsia, CIMB, Maybank, Sime Darby, IHH Healthcare, Petronas Chemicals, Maxis , Axiata and Public Bank, among others. . The market fully supports the growing number of companies whose ambitions lie in a regional or global role.

“Beyond size, income and profit, they help in building the image of the Malaysian market – we are now increasingly seen as a gateway to ASEAN investments by many investors around the world. “, said Tajuddin.

Boost SMEs

This recognition also helps support SMEs – a big part of the Malaysian economic miracle, and no doubt, where the next generation of Malaysian global champions will emerge.

Tajuddin went on to explain that Bursa Malaysia has developed various platforms to serve the SME segment – the ACE marketplace, the mid and small cap research program to foster visibility and discovery, and the first such platform. for sophisticated investors and SMEs in ASEAN, the LEAP market which helps close the financing gap for SMEs. The government has also provided listing incentives (LIVE) to create more opportunities for underserved SMEs.

Increase the investor base

“The third force is the active participation of a wide range of investors. Bursa Malaysia is constantly investing in education programs in this area. Last year alone, we reached 35,000 investors at more than 170 investor seminars and workshops, Tajuddin said. As early as 2014, Bursa Marketplace – an online virtual marketplace and educational portal began to provide access to market knowledge, ideas and trading ideas while helping to develop financial literacy. Retail participation increased by 41% in 2017.

New arrivals

The fourth force comes from market innovations – in the Islamic capital market, the derivatives market and the conduct of the sustainable development agenda.

Innovative products and solutions can be seen in the international commodity trading Bursa Suq Al-Sila, Bursa Malaysia-I, the world’s first end-to-end Sharia law investment platform and the negotiated transaction of selling and buying Islamic securities (ISSBNT), the world’s first alternative to Sharia-compliant securities borrowing and lending.

Tajuddin went on to say that Bursa Malaysia’s central role in the development of the Islamic capital market and its foresight in providing innovative market-based financing solutions has earned the company many global accolades. This includes Asia’s Best Islamic Stock Exchange in 2016 and 2017, World’s Most Innovative Sharia-Compliant End-to-End Investment Platform 2017, The World’s First End-to-End Compliant Investment Platform Sharia Law and Best Commodity Trading Platform Asia 2017.

“We are also known for Malaysian Crude Palm Oil Futures (FCPO) – now a global benchmark. And in the area of ​​driving the sustainability agenda, Bursa Malaysia was the first emerging market to launch the global benchmark FTSE4Good Bursa Malaysia, ”Tajuddin said.

These are the four forces at play and the resulting impacts. These forces exist in the strong vision and framework of the country’s economic policies that have helped to support growth, create an environment where businesses can thrive and encourage innovation in the new economy.

Continuity and stability

It is a market that continues to show positive momentum, supported by strong fundamentals – growth is resilient, domestic demand continues to grow and Malaysia is considered one of the strongest markets in ASEAN and an attractive investment destination. These attributes have been incorporated into the Malaysian economy over the past decade and form the foundations on which the positive trajectory of sustainable growth can continue.

“As investors, businesses and even economic decision-makers craft their future growth plans, they all depend on a sense of continuity of effective policies, credible governance and stability. For Bursa Malaysia, these are the critical factors as we continue to liberalize the capital market further – to build a developed exchange that can meet the demands of a developed country, ”Tajuddin concluded.


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