SC: Malaysia's capital market resilient

In a statement yesterday, the SC said the measures aim to ensure that cyber risk is managed in an optimised manner, in light of the changing landscape in the market.

KUALA LUMPUR: Malaysia's capital market expanded to RM2.85 trillion as at September this year from RM2.82 trillion in December last year and remains resilient despite the volatility in global markets, says the Securities Commission deputy chief executive.

Datuk Ahmad Fairuz Zainol Abidin said the equity market capitalisation as at September stood at RM1.68 trillion while the bond and sukuk markets amounted to RM1.17 trillion.

Malaysia's capital markets can weather the storm, given their fundamentals, he said in his opening address at the Asian Strategy and Leadership Institute's (ASLI) 21st Malaysian Capital Market Summit in Kuala Lumpur on Tuesday.

"Despite the challenges and volatility in the global markets, the Malaysian capital market has remained relatively resilient," he said.

Ahmad Fairuz said the capital market continues to play a major role in supporting economic growth through financing of business expansion and infrastructure development.

He said as at September, RM66.9 billion were raised through the capital market, a reasonable amount considering the market conditions.

He added that assets under management as at September increased 4.8% to RM700 billion while unit trusts' net asset value stood at RM356 billion, reflecting investors' sustained participation in the market.

Ahmad Fairuz said the Islamic capital market remains a key component of the overall capital market and has more than tripled in size between 2005 and 2015, reflecting a compounded annual growth rate of 12%.

"The market reached RM1.7 trillion as at September 2016, representing 61% of Malaysia's entire capital market," he said.

He said Malaysia continued to be the global leader in the sukuk market, commanding 54% of the global sukuk outstanding as at end-2015.

Ahmad Fairuz said Malaysia's Islamic fund industry is also well developed, holding approximately 35% of the US$58 billion of Islamic funds' assets under management globally as at March this year.

"Malaysia has sustained its solid foundation to continue to pursue its aspirations to further widen its international base and seize new growth opportunities in the Islamic capital market," he said.

He said these include tapping new growth segments, notably in Islamic fund and wealth management and waqaf as well as enhancing existing capacity and capability.

"The SC will continue its effort towards greater internationalisation of the Islamic capital market, particularly the fund and wealth management segment," he said.

Ahmad Fairuz said moving forward, the SC would continue to garner greater interest and drive digital finance initiatives in the Malaysian capital market, including the introduction of peer-to-peer (P2P) financing, a debt crowdfunding platform, this year.

He said this follows the encouraging reception to equity crowdfunding after the introduction of the Recognised Market Operator (RMO) framework last year, making Malaysia the first nation in Asean to introduce the fundraising platform.

As of September, he said, close to RM6 million worth of equity have been successfully raised through the equity crowdfunding platform.

He said six equity crowdfunding operators, registered and granted RMO status, have garnered interest from 38 industry sectors for early stage financing, with 45% being technology companies.

"Forty-eight per cent of their investors are 35 years old or younger, demonstrating that digital market-based solutions can be an exciting avenue to attract young investors," he said. - Bernama