KUALA LUMPUR: The Malaysian capital market grew 12.6% to RM3.2 trillion in 2017, with total funds raised amounting to a record high of RM146.6bil.
The Securities Commission (SC) said the capital market last year saw double-digit growth across segments, with the equity market rising 14.4% to RM1.9 trillion, bond and sukuk up 10.1% to RM1.3 trillion, and the Islamic capital market rising 11.9% to RM1.9 trillion.
The fund management industry, on the other hand, grew 11.5% to RM776.2bil in asset under management.
SC chairman Tan Sri Ranjit Ajit Singh said the strong growth of Malaysia’s capital market was attributed to better economic fundamentals, continued corporate earnings recovery, fundraising for infrastructure, strong foreign inflows and higher investor participation.
“The capital market has recorded strong growth in all segments and continues to play a major role in capital formation and the financing of the Malaysian economy, while at the same time offering a wide range of opportunities for investors as reflected by the high level of participation.
“We will continue to ensure a facilitative ecosystem and regulatory architecture to promote the trust and confidence in the market,” he said in conjunction with the release of the SC’s 2017 annual report.
In his annual report briefing, Ranjit noted that at RM3.2 trillion, the capital market was 2.4 times the size of Malaysia’s gross domestic product, a measurement of the total value of all goods and services produced in the economy. The number also put Malaysia’s capital market as the fifth largest in Asia, he said.
According to the SC, fundraising was also exceptionally strong last year, at a record high of RM146.6bil, surpassing the five-year average of RM116bil.
Of the total funds raised last year, RM124.9bil came from corporate bonds and sukuk issuances, with the segment exceeding the RM100bil mark for the first time since 2012. Fundraising via the equity market, on the other hand, totalled RM21.7bil, up from RM12.8bil in 2016 .
For the equity market, RM7.2bil was raised via 12 initial public offerings, while RM14.5bil was raised in the secondary equity market for business expansion and balance sheet strengthening.
For 2018, Ranjit said the continuation of global economic expansion would be a positive influence on the capital market, particularly for the emerging markets which saw sustained interest.
“The Malaysian capital market is expected to remain robust and competitive on the back of sound economic fundamentals and higher earnings forecast,” he said.
Meanwhile, as part of the SC’s role in upholding the integrity of the capital market, the regulator in 2017 took 62 enforcement actions, which constituted criminal prosecutions, civil actions and administrative actions. The enforcement actions included criminal actions on 10 individuals prosecuted cumulatively with 37 criminal charges for various offences.
The SC also filed civil actions against 20 individuals for breaches of various securities laws, and issued 81 infringement notices.
Its enforcement actions in 2017 includes RM2.8mil in penalties being imposed, and RM8.9mil released for investor restitution.
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