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Borneo Bulletin, Tuesday 28 February 2017

KUALA LUMPUR (Bernama) – The banking sector

in Malaysia will see a slowdown in the next 12 to

24 months in line with the slowdown in the Gross

Domestic Product (GDP).

HSBC Bank Malaysia Chief Executive Officer

Mukhtar Hussain said the economic condition

was now more subdued than in previous years

and this had impacted capital investment.

“However, the banking system, which is well

regulated, capitalised and prudent with strong

corporate governance, will help institutions

manage well during these times,” he told a press

conference here yesterday on shaping a different


He said the banking system would improve

in line with the underlying improvement in the

economy along with initiatives to support the


A monorail train passes by the city centre at a shopping district in Kuala Lumpur


Banking sector in

Malaysia to see a

slowdown in

12-24 months

BEIJING (AFP) - China’s top securities regulator has pledged

to speed up approvals of initial public offerings (IPOs), as

the government seeks to attract capital and boost domestic


Buoyed by the capital market’s recovery from a 2015 rout,

the China Securities Regulatory Commission (CSRC) on Sunday

indicated it would loosen its grip on the nation’s stock markets.

The CSRC decides which companies offer shares and when,

as well as setting guidelines for the number of shares and their

price - all of which are determined by the market in other


Regulators responded to the equities rout in the summer of

2015 by freezing new IPOs in an effort to stabilise stock prices,

but CSRC chairman Liu Shiyu vowed to end this practice and

introduce “new progress and breakthroughs”.

More than 600 companies seeking to list in the market have

struggled with long wait times, followed by seemingly arbitrary


Liu said faster approvals, particularly for companies in

poverty-stricken counties, will attract new capital and boost

investor confidence.

“Liu seems to be the first CSRC chief to publicly denounce

the practice of shutting down the IPO market whenever there

is a crisis,” Dong Dengxin, a finance professor at Wuhan

University of Science and Technology, told the official Xinhua

news agency.

While the regulator signalled a willingness to allow the

market to play a larger role in share sales, it has also cracked

down on illegal activities by “barbarians”.

Mainland Chinese stock exchanges have an unusually

high proportion of non-professional investors and have been

compared to “casinos”, with insider trading and dramatic

swings in share prices seemingly unconnected to underlying

business prospects.

“There is only a half-step distance between being a financial

mogul and a financial crocodile,” Liu said.

Li Chao, the CSRC’s deputy head, said closer supervision -

in the form of compliance risk management and standardised

banking businesses - will help prevent a repeat of the stock

market turbulence of 2015.

Following a slump that saw the Shanghai stock index tumble

nearly 40 per cent in a little more than two months - after

peaking in mid-June that year - several investment executives

were investigated on suspicion of insider trading.

Last month, former star hedge-fund manager Xu Xiang was

jailed for five and a half years.

His was the first insider trading case to be brought to Chinese

court and involved more than 40 billion yuan ($5.8 billion),

financial magazine Caixin reported.

The CSRC’s planned reforms come as the government tries

to staunch a flood of capital heading overseas as investors look

for better returns, with interest rates expected to rise, putting

pressure on the yuan and threatening the economy.

After Chinese firms went on a multi-billion-dollar foreign

acquisition spree last year, the government responded by

blasting what it called “irrational” spending and started rolling

out new restrictions to curb the outflow of money.

The Shanghai Composite Index ended 0.76 per cent

lower Monday, in line with a sharp sell-off across Asian stock


China Securities Regulatory Commission Chairman Liu Shiyu gestures as he speaks during a press brie ing on the reform,

stability and development of the Chinese capital market, at the State Council Information Of ice in Beijing


China pledges to speed up

approval of stock listings

RIYADH (AFP) - Saudi Arabia on Sunday launched

a parallel equity market designed to boost small

and medium enterprises that closed up 20 per

cent, the maximum allowed in a single day,

brokers said.

The index on the parallel market, Nomu, listing

seven companies, closed at 6,000 points with

trading of 256 million Saudi riyals (about $67


Argaam, a Saudi economicwebsite, put the total

capitalisation of the seven companies trading on

Nomu at 1.8 million riyals ($479 million).

The companies listed are Raydan Restaurants,

Baazeem Trading Company, Arab Sea, Al

Omran Trading, Abdullah Saad Abo Moati, Food

Development Company and Al Samaani Metal.

Argaam said Baazeem was the most active on

Sunday with 2.2 million shares trading hands.

To be listed on Nomu, companies must have

a market value of at least 10 million riyals ($2.7

million), a minimum of 35-50 shareholders and at

least 20 per cent of shares publicly owned.

Firms listing on the oil-rich kingdom’s main

stock market - the Tadawul - must have minimum

capitalisation of 100 million riyals, or 10 times

that of the new platform.

Nomu’s launch was announced last Monday

by Tadawul which said the new equity market

was “an alternative trading platform with lighter

listing requirements”.

New Saudi stock

market opens with

gains of 20 per cent

LONDON (AFP) - The London Stock Exchange on

Sunday said it is “highly unlikely” it will be able

to meet antitrust conditions set by Brussels for its

tie-up with Deutsche Boerse, throwing the merger

into doubt.

The announcement by LSE, which also operates

the Milan stock exchange, is the latest twist in its

longstanding attempt to merge with the German

stock exchange operator.

The LSE said it had examined the European

Commission’s request to divest its majority stake

in Italian trading unit MTS, concluding it could

not commit to such a request.

“The LSEG Board believes that it is highly

unlikely that a sale of MTS could be satisfactorily

achieved, even if LSEG were to give the

commitment,” LSE said in a statement.






Commission raised new concerns on February 16

about the merger, giving the company a deadline

of midday on February 27 to outline a proposal

for divesting in MTS.

“Based on the Commission’s current position,

LSEG believes that the Commission is unlikely to

provide clearance for the merger,” it added.

LSE says Deutsche

Boerse merger in doubt