"The implementation of ISS for direct business transaction is indeed a significant step in ensuring local and foreign institutional investors continue to have access to a secure and efficient clearing and settlement system.
"ISS reduces the settlement risk exposure of institutional investors whilst enhancing the delivery versus payment environment in line with international settlement best practices and requirements," he said.
The ISS for on-market transactions was first introduced in July 1999 to enable eligible financial institutions to clear and settle securities transactions on behalf of their institutional clients directly with SCANS.
On market transactions are transactions that are executed through the Automated and Computerised Trading System established by the Exchange whilst direct business transactions are transactions that are not executed through the Automated and Computerised Trading System.
Ungku Razak said the implementation of ISS for direct business transactions has commenced upon confirmation of industry readiness with the completion of consultation, joint testing and simulation exercises involving clearing members of SCANS since the beginning of this year.
"It is certainly important for us to work closely with industry participants to ensure there is continuous progress in improving infrastructure development for the securities industry.
"It is with such improvements that the Malaysian securities industry can continue to strengthen its competitive edge as part of the effort to ensure Malaysia continue to be an attractive investment destination," he said.
