The Stock Exchange of Thailand (SET) said that there were five consortia applying to set up and manage Thailand’s first equity ETF (exchange-traded fund). The successful applicant will be announced by the third week of February.
In seeking a fund management team, SET issued a ‘request for proposals’ to members of the Association of Investment Management Companies and Association of Securities Companies, and accepted responses until December 8, 2006, SET Senior Vice President Dr. Sethaput Suthiwart-narueput stated.
Requirements for the five applicants include having established networks with institutional and retail investors, strategies for marketing, liquidity enhancement and investment, starting capital and growth projections, fee levels, and the ability to introduce the ETF within the specified timeline. Further information is available at http://www.set.or.th/setresearch/files/etf/20061102-ETF-RFP.pdf
“After announcing the successful applicant, SET will work with them on educating the market. An equity ETF will be launched in Q2/2007 as scheduled,” Dr. Sethaput said.
Thailand’s first equity ETF will use the SET50 Index, and any other indices proposed by the consortium and approved by SET, for underlying securities. The fund must have at least one market maker, and its initial public offering (IPO) must be at least THB 300 million (approx.USD 8.33 million). SET will allocate an initial THB 100 million for the fund to facilitate this as the first Thai equity ETF. The Exchange will be able to sell ETF units six months after the IPO.
“Each consortium’s proposal is detailed and impressive, which SET greatly appreciates,” Dr. Sethaput added.
The selection of the successful ETF consortium is being conducted by a working committee, who last met on January 30 – 31, comprised of representatives from SET, including from the following units: Research and Information, Information Technology, Investor Marketing, Listing & Disclosure, Market Surveillance, Member Services, Securities Depository, Clearing, and Legal.
