Pursuant to the agreement signed between KLSE and Singapore Exchange Limited (SGX) on 25 February 2000, all CLOB securities held in the CDS account of Central Depository Private Limited (CDP) in its capacity as an authorised nominee, are to be released to the CDS accounts of the holders of the CLOB Securities through Schemes A and B. The holders of the CLOB Securities were given the option through CDP, to subscribe to either Scheme A or Scheme B.
Both Schemes fully comply with the rules and procedures of KLSE and MCD as well as the provisions of the Securities Industry Act 1983 which clearly spells out KLSE's duty to maintain an orderly and fair market for securities trading in Malaysia.
Scheme A was successfully implemented on 3 July 2000 and saw the successful release of 98 % of the CLOB Securities, through a staggered release framework, over a period of 56 weeks. Scheme A has met the objective of the KLSE in ensuring a fair and orderly market.
Scheme B will involve the staggered release of the CLOB Securities remaining in the securities account of CDP after the successful implementation of Scheme A.
Holders of the CLOB Securities have been informed of the implementation of Scheme B and those interested have subscribed to the scheme through CDP. It is estimated that 73% of the remaining CLOB Securities, totalling 166 million shares, valued at RM293 million, will be involved in the release under Scheme B.
The release of these securities is expected to have minimum impact on the local stockmarket. KLSE will however continue to monitor the status of the staggered release of the CLOB Securities.
With regard to the CLOB Securities remaining in the CDP account after the implementation of the two schemes and the lapse of CDP's authorised nominee's status on 30 September 2003, it will be dealt with in accordance with the provision of law.
