Scaling down regulations


A STATEMENT from the two capital market regulators – the Securities Commission (SC) and Bursa Malaysia – has taken the market by surprise.

In their joint statement this week, one line stands out: “As market discipline continues to strengthen, the SC and Bursa will proportionately scale down the intensity of regulatory discipline”.

The true meaning of what that would entail, though, isn’t clear at this point.

The statement has also taken a number of working-level people at the regulators by surprise.

Industry sources say that it has come about after changes have taken place at the top level of both regulators.

In particular, Bursa’s new chairman Datuk Shireen Ann Zaharah Muhiudeen (pic) comes from the industry and has sought feedback from market participants to bring about the changes.

The SC’s new chairman Datuk Syed Zaid Albar has also been instrumental in the changes being brought about.

The joint statement by the regulators says that the idea of loosening regulation is to create a more vibrant market.

But is this thinking correct?

What is worse is that on the face of it, it does seem as if the regulators are paving the way for a comeback of the rah-rah days, also known as the days of the “cowboy” market.

Related stories:

Bursa: We are looking at a ‘just-right’ level of regulation

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