Ms. Patareeya Benjapolchai, the 10th President of the Stock Exchange of Thailand, revealed that SET will press on with the implementation of the second Thai Capital Market Master Plan, in close collaboration with Federation of Thai Capital Market Organizations (FeTCO) and other relevant state and private agencies.
“To ensure that SET and the other cooperating agencies all share the same aims and vision, we will be consulting closely with the members of FeTCO and other supporters of the Thai Capital Market Master Plan, on a quarterly basis beginning in June. At this point, we have taken only the first steps under the master plan, but I am confident that we can deal with any difficulties along the way,” Ms. Patareeya said.
In large part SET will achieve its major goals on demand and supply sides through the recruitment of new, high-quality listings and investor education.
“We have to admit that, currently, there are several factors affecting the attractiveness of SET for listed companies and investors. Consequently, the most immediate issue is to regain investor confidence. We can achieve this through the development of new products, by concentrating on large, blue-chip corporations, and by encouraging investors to diversify both their portfolios and their ways of investing,” said the SET President.
Ms. Patareeya said that in order to have access to large, blue-chip firms, SET plans to meet with those which are already clients of the large commercial banks, the FTI and the Thai Chamber of Commerce. Concurrently, the Exchange will establish a special consulting team specializing in funds structuring and the prompting induction of companies planning to list on the Stock Exchange.
“When interest rates are rising, it is difficult for businesses to raise funds. Consequently, this provides an opportunity for SET to target firms seeking capital to grow their business. By increasing its listings, SET can regain public confidence, and reaffirm its role as the center of capital activity, which in turn will make the market more interesting and attractive to investors.”
SET will be working with Listed Companies’ Association to develop the capacity of firms in a number of areas. There will be a strong emphasis on disclosure in terms of both quality and distribution of information. Listed companies will be supported in investor relations activities to increase the effectiveness of their marketing and dissemination of information.
The development and promotion of new products, such as ETF, will boost market liquidity.
“SET will attract more investors by offering a variety of products, such as equities, debt and derivatives instruments, and mutual funds. There are marketing plans in place for each of these innovations, and we are confident of that this year the bonds and derivatives instrument will be especially attractive to investors.
More facilities are being developed, such as IPO Online which will be available by the end of 2006, and SBL (securities borrowing and lending) to be offered by Q3/2006. These will further enhance market liquidity.
In regard to mutual funds, SET cooperates with the Association of Investment Management Companies (ASCO) to encourage more investment through LTFs (long-term mutual funds) and RMFs (retirement mutual finds). Currently, there is a potential market of two million income-earners.
To promote securities analysis, SET will collaborate with the Securities Analysts’ Association (SAA) to support the undertaking and dissemination of research. To ensure that research is of the highest quality and meets accepted standards, ASCO will supervise marketing representatives, and research projects will be assessed and ranked.
Ms. Patareeya added that market regulation today is strengthened because investors are more informed and better able to interpret both companies’ information, and SET rules and procedures. Similarly, listed companies are becoming more sophisticated in understanding how SET’s policies and regulations work to protect the whole capital market system.
Concerning investors, SET will focus on investor education through the university networking project and other educational activities. This policy is intended to provide a solid intellectual basis for long term investment activity.
In conclusion, SET continues to highlight corporate social responsibility and associated endeavors. SET will continue to cooperate with relevant organizations, such as listed and member companies, to improve the quality of life of people in need.