Securities Commission Malaysia Q1 Scorecard: Sustained Interest Continued In 2011

Sustained interest in the market continued in the first quarter of 2011 with the Securities Commission Malaysia (SC) receiving a total of 35 substantive applications compared with 27 in the previous quarter.

Four out of the 35 applications were for initial public offerings (IPOs) with a total potential market capitalisation of approximately RM3.72 billion.

The SC approved an IPO application from a China-based company during the quarter with a potential market capitalisation of about RM1.10 billion. Higher interest was seen in the bond market where 17 debt securities proposals were approved in this quarter, more than double the eight approvals in the same period last year.

Compared with Q1 last year, the RM-denominated Sukuk market this quarter saw significant interest with the SC approving five sukuk issuances amounting to RM7.77 billion.  This is a stark contrast to the two approved during the same period last year, which amounted to only RM0.590 billion.

The SC maintained its high performance standards with 96 percent of corporate proposals and 99.84 percent of licensing applications processed within the time charters. A total of 1,390 licence applications were received in Q1 2011. The encouraging number of new entrants (206) into the market at the start of the year sets the stage for vibrant growth of the market, both in terms of quantity and quality of the players. 

Capital market statistics released by the SC cover information on processing, approvals and rejections of submissions, including timing and reasons. In addition to these scorecard indicators, the quarterly statistics of submissions approved by the SC for the first and the fourth quarters of 2010 were also reported.

The full series of capital market statistics released by the SC is set out below. 

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CAPITAL MARKET STATISTICS

SC Scorecard Q1 2011

&

Statistics of Submissions Approved by SC in Q1 2011

 

A.      Corporate Submissions to the SC – Q1 2011

 

Table 1: Status of Substantive Applications as at 31 March 2011

 

Applications	Total
Balance brought forward from Q4 2010	7
Add: Applications received in Q1 2011	351
Total applications	42
Less: Applications Considered/Withdrawn in Q1 2011	(24)
Balance carried forward to Q2 2011	18

 

⁽¹⁾ Including one re-application which was deferred in the previous quarter. 

 

Table 2: Substantive Applications Considered/Withdrawn in Q1 2011

 

Type of proposals	Considered			Withdrawn	Total
	Approved	Rejected	Returned1
Initial public offering -          Main Market	1	-	1	-	2
Reverse Take-Overs  and Restructurings	-	-	-	1	1
Transfer to Main Market	-	-	-	-	-
Private debt securities	17	-	1	-	18
Others2	3	-	-	-	3
TOTAL	21	-	2	1	24

 

⁽¹⁾ Main reasons for the returned applications were poor standards of submissions, such as non-compliance with guidelines.

⁽²⁾ Offering of equity securities by foreign corporations with no listing on Bursa Malaysia .
Table 3: Processing Turnaround Time for Substantive Applications Considered in Q1 2011

 

Substantive Applications	Within Time Charter1		Exceed Time Charter		Total
	No.	%	No.	%	No.	%
	22	96	1	4	23	100

 

⁽¹⁾     The SC time charter for processing is computed from the date of receipt of complete information of the application up to the date of the decision letter, and this is applicable to the following proposals: 

 

·         Initial public offerings (IPOs) and acquisition of assets resulting in a significant change in the business direction/policy of a listed company: 52 working days; 

·         Large capitalisation IPOs applications and transfer of listing to the Main Market of Bursa Malaysia : 32 working days; and

·         Private debt securities applications: Deemed approval and 14 working days.

 

 

Table 4:           Status of Licensing Applications in Q1 2011

 

Type of licence application	Received	Withdrawn	Returned	Considered	Approved	Rejected	Pending
Representative
New	266	5	13	248	203	0	45
Renewal	1,069	0	4	1,065	1,050	0	15
Corporation
New	9	0	0	9	3	0	6
Renewal	46	1	2	43	37	0	6
Individual
New	0	0	0	0	0	0	0
Renewal	0	0	0	0	0	0	0
Total	1,390	6	19	1,365	1,293	0	72

 

 

Table 5: Processing Turnaround Time for Licensing Applications in Q1 2011

 

Type of licence application
	Within time charter		Exceeds time charter		Subtotal	Exception		Total Reported
	Total	%	Total	%		Total	%
Representative
New	199	99.50	1	0.50	200	3	1.48	203
Renewal	1,049	99.90	1	0.10	1.050	0	0	1,050
Corporation
New	3	0	0	0	3	0	0	3
Renewal	32	100	0	0	32	5	13.51	37
Individual
New	0	0	0	0	0	0	0	0
Renewal	0	0	0	0	0	0	0	0
Total	1,283	99.84	2	0.16	1,285	8	0.62	1,293

B.      Corporate Submissions Approved by the SC – Q1 2010

i)       Proposals Approved

 

Table 6: Number of Corporate Proposals Approved

 

Type of Proposals	No. of Corporate Proposals Approved
	Q1 2011	Q4 2010	Q1 2010
Initial public offering -          Main Market	1	9	10
Reverse Take-Overs  and Restructurings	-	-	-
Transfer to Main Market	-	2	1
Private debt securities	17	27	8
Others	31	4	-
TOTAL	21	42	19

 

⁽¹⁾  Offering of equity securities by foreign corporations with no listing on Bursa Malaysia .

 

ii)      Private Debt Securities

 

Table 7: Approved RM-Denominated PDS Issues

 

Type	Q1 2011		Q4 2010		Q1 2010
	No. of issuers	Size of issues (RM'mil)	No. of issuers	Size of issues (RM'mil)	No. of issuers	Size of issues (RM'mil)
Conventional	9(1)	5,918.29	15(2)	7,134.97	5(3)	8,586.00
Sukuk	5	7,770.00	8	20,565.00	2	590.00
Combination4	-	-	-	-	-	-
Total	14	13,688.29	23	27,699.97	7	9,176.00

 

(1)   Include 2 asset-backed securities (ABS) amounting to RM3,100.0 million.

(2)   Include 1 ABS amounting to RM400.0 million.

(3)   Include 2 ABS amounting to RM1,400.0 million.

(4)   Combination of conventional and sukuk.

 

Table 8: Approved Foreign Currency-Denominated PDS Issues by Foreign Corporations

 

Type	Q1 2011		Q4 2010		Q1 2010
	No. of offers	Size of offers ('mil)	No. of offers	Size of offers ('mil)	No. of offers	Size of offers ('mil)
Conventional	-	-	1(1)	176.89	-	-
Sukuk	1(1)	-(2)	3(1)	750.00(3)	1(1)	450.00
Combination	-	-	-	-	-	-
Total	1	-	4	926.89	1	450.00

 

(1)   Offers in Malaysia were part of a global offering.

(2)   Offer size had yet to be finalised at the point of approval.

(3)   Include 2 proposals which had yet to finalise the offer size at the point of approval.

 

Table 9: Approved Foreign Currency-Denominated PDS Issues by Malaysian Issuers

 

Type	Q1 2011		Q4 2010		Q1 2010
	No. of offers	Size of offers ('mil)	No. of offers	Size of offers ('mil)	No. of offers	Size of offers ('mil)
Conventional	2	1,300.00	-	-	-	-
Sukuk	-	-	-	-	-	-
Combination	-	-	-	-	-	-
Total	2	1,300.00	-	-	-	-

 

 

iii)  Take-Overs & Mergers

 

Table 10: Number of Approved Submissions Relating to the Malaysian Code on Take-Overs
                 and Mergers

Type	Number of Submissions Approved
	Q1 2011	Q4 2010	Q1 2010
Clearance of offer document	6	11	5
Application for exemption from mandatory offer obligation	4	6	10
Others	28	29	19
Total	38	46	34

 

iv) Unit Trusts & Collective Investment Schemes

 

Table: 11: Number of Submissions Relating to Unit Trusts and Other Collective Investment                Schemes Approved

Type	Number of Submissions Approved
	Q1 2011	Q4 2010	Q1 2010
Establishment of new funds	16	17	24
Increase in fund size	13	9	16
Exemption/variation from Guidelines1	4	1	4
Other applications 2	13	10	13
Total	46	37	57

 

⁽¹⁾  Excluding applications submitted through the establishment of new schemes.

⁽²⁾ Including applications for extension of time and change of management company.