The TSD collaborated with all the organizations involved, both in the public and private sectors, such as the Securities and Exchange Commission, the Bank of Thailand, the commercial banks, securities companies, and investment management companies. It has also hired the Capital Markets Company Limited (Capco), an expert in the word capital markets with its headquarter in England and with offices in all the world's major capital markets, to conduct research on the order transmission and clearing systems in the Thai capital markets. Capco concluded that the present systems has a level of efficiency equal to other markets and can cope with the adjustments the TSD will need to initiate in order to shorten the settlement and clearing period in accordance with the changes in major capital markets of the world.
Ms. Nongram explained "The present efficient work system begins from trading orders sent from the institutional or retail investors to the SET member companies. Orders are then transmitted to trading system of the SET, transactions occur until the orders are confirmed back to both the investors and the banks that act as the trustees. These transactions have a level of efficiency equivalent to the widely accepted standards of the current technology. There should not, therefore be any difficulties if there is pressure from the world capital markets for us to shorten the clearing and settlement period to T+2 or even T+1. Adjustments can be made to the technology that links all the processes, from preparing the trading orders through to the final clearing and settlement procedure, which is called "Straight Through Processing" or STP. This study started in October last year, reached its conclusion and was presented to all related parties on April 29 - taking six months in all to complete. We can then be confident that we fully comprehend these issues and have readiness equal to the world's major capital markets. And we are in a comparatively advanced stage relative to many emerging markets that haven't yet started conducting any studies."
The President of the Stock Exchange of Thailand and the Executive Chairman of the TSD, Mr.Kittiratt Na-Ranong, added: "We realize that our Exchange is in one of the emerging markets and will therefore not introduce any system involving clearing and settlement in advance of the developed market. This study of the new developments has thus created confidence in market participants regarding the potential and readiness of the Thai capital market's existing system as well as the funds to develop the system, which may be as high as one billion baht. However, compared to the financial resources of the SET and the TSD, totaling around 10 billion baht, it is not that high comparatively speaking."
