KLSE Deputy President II Ungku Razak Ungku A Rahman said KLSE, through its clearing house Securities Clearing Automated Network Services Sdn Bhd (SCANS), has conducted industry wide consultation, testing and simulation exercises since early this year to expand ISS for direct business transactions.
"The findings from the extensive exercise conducted involving clearing members of SCANS have indicated we are ready to implement ISS for direct business transactions by Wednesday, 18 July 2001," he said.
SCANS has issued circulars to its clearing members to announce the implementation date, changes to SCANS rule, information technology and operating procedures related to ISS for direct business transactions.
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 since the introduction of ISS, the clearing and settlement of on-market transactions for institutional investors have been enhanced significantly.
"ISS reduces the settlement risk exposure of institutional investors and whilst making clearing and settlement for institutional investors more effective and cost efficient," he said.
