THE Securities Commission (SC) will continue to hold talks with Asia Pacific and African countries on promoting strategic partnerships for dual listing and liasing of an Asian bond market via the Labuan Financial Exchange (LFX), according to its chairman Datuk Ali Abdul Kadir.
“It can be an Asean or an Asian bond market, depending on the support from the countries. So far, the responses have been positive. We are also looking to have Asian bonds dual listed on the LFX,” Ali said at the sidelines of the business forum on South-South cooperation.
“We have been talking about dual listing and remote access terminal with our colleagues in Asia Pacific,” he said.
Ali said he had made this proposal to Islamic capital markets to encourage them to list syariah-compliant counters on the LFX, which would attract Islamic funds and investors.
He said it would be another form of investment.
“The investors can come in to the LFX and buy for instance, a Thai or a Singapore bond,” he said.
Ali said he would forward this suggestion to the higher authorities for approval first and declined to say when this idea would materialise.
He also suggested that each participating country could also have a stake in LFX.
“For instance, we can give them a 10% stake so that everybody has a commitment to make it work,” he said.
Ali said that an Asian bond market would deal with countries that used more than one currency, which would mean an inflow of foreign currencies to LFX.
On the dual listing of companies, Ali said it would deter listed companies from migrating to attractive markets and would create fair value recognition for Malaysian counters.
“This fulfils the two requirements of capital markets: access to capital market for funds and creation of liquidity as there will be more demand for shares,” he said.
Ali said this would also attract international recognition and subsequently attract multinationals to be listed on the domestic market.
To date, a handful of local listed companies are also listed internationally in Tokyo, Luxembourg and London.
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