SC expects more retail investments in equities


  • Markets
  • Thursday, 16 Apr 2020

SC chairman Datuk Syed Zaid Albar said foreign investors, especially strategic holding remains consistent over the years. As at the end of March 2020, foreign shareholding in the equity market stood at 22.46 per cent, and the average foreign shareholding during 1998 to 2019 period is about 22.3 per cent.

KUALA LUMPUR: Retail investments in the equity market are expected to increase this year, especially with online account activation currently exceeding 10,000, said Securities Commission’s Market and Corporate Supervision executive director, Kamarudin Hashim.

He said to-date, the retail investment’s participation in the equity market has risen to 44 per cent from 40.9 per cent last year.

"We are seeing a lot of improvement in terms of retail participation, which has started to increase since January this year, ” he said in a virtual media conference on Thursday.

Kamarudin noted that in terms of trading value year-to-date, retail participation represents 24.3 per cent versus 20.8 per cent last year.

Meanwhile, acknowledging that companies may face challenges as a result of the pandemic, the SC announced that Bursa Malaysia will provide companies listed on the Main Market temporary relief from the Practice Note 17 classification in relation to the following criteria:

The shareholders’ equity of the listed issuer on a consolidated basis is 25 per cent or less of the share capital (excluding treasury shares) of the listed issuer and such shareholders’ equity is less than RM40 million.

The auditors have highlighted a material uncertainty related to going concern or expressed a qualification on the listed issuer’s ability to continue as a going concern in the listed issuer’s latest audited financial statements and the shareholders’ equity of the listed issuer on a consolidated basis is 50 per cent or less of share capital (excluding treasury shares) of the listed issuer.

A default in payment by a listed issuer, its major subsidiary or major associated company -- as the case may be -- as announced by a listed issuer pursuant to paragraph 9.19 A of the Listing Requirements and the listed issuer is unable to provide a solvency declaration to the Exchange.

According to the SC, these measures would allow companies more time to regularise their financial positions.

Similar temporary relief from Guidance Note 3 classification will also be provided by Bursa Malaysia for companies listed on ACE Market.

The period for this PN17 relaxation will be effective from April 17-June 30,2021.

Asked to comment on the foreign investors in the equity market, chairman Datuk Syed Zaid Albar said market volatility is seen globally and is not specific to Malaysia.

"Foreign investors, especially strategic holding remains consistent over the years. As at the end of March 2020, foreign shareholding in the equity market stood at 22.46 per cent, and the average foreign shareholding during 1998 - 2019 period is about 22.3 per cent.

"This is a hugely unprecedented time.. we are facing humanitarian, economic, financial challenges all at the same time; it is no longer business as usual and uncertainties will remain even after the pandemic subsides.

"However, I would like to remind our fund managers and intermediaries that they must continue to ensure that investors are treated fairly. At the SC, we will do our part to support you and to provide the steady hand that is needed at this time, ” he concluded. - Bernama

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