Issue 2 Vol 1 Jul 2009

www.bursamalaysia.com

Introducing the FTSE Bursa Malaysia KLCI

The benchmark index KLCI successfully transitioned to the FTSE Bursa Malaysia KLCI with effect from 6 July 2009. For more information on the enhanced features of the FTSE Bursa Malaysia KLCI, please click here.

NOTE FROM THE EDITOR

Invest Malaysia 2009 A Resounding Success

The Invest Malaysia 2009 (IM09) conference held on 30 June and 1 July 2009, was well attended by 600 delegates (80 foreign and 520 local) from 61 foreign and 124 local organisations.

This positive response is a reflection of the strong interest among local and foreign investors in the attractive opportunities that the Malaysian capital market holds. This fifth edition of the Invest Malaysia conference series still tops the calendars of institutional investors as Malaysia’s most anticipated investor conference. The theme of IM09 was “Malaysia’s Growth Drivers”.

Organised by Bursa Malaysia with co-sponsors CIMB Investment Bank and the Capital Market Development Fund, the highlight of IM09 was the keynote address by Dato’ Sri Najib Tun Razak, the Prime Minister of Malaysia, which also

MARKET HIGHLIGHTS

The first half of this year has certainly been momentous. At the annual flagship Invest Malaysia conference, we heard the Honourable Prime Minister YAB Datuk Seri Najib Tun Razak make significant announcements that will bode well for the growth of the Malaysian capital market as we move into a more market based policy framework. Among the announcements made is the removal of the FIC guidelines which we hope will further galvanise Malaysia to be well-positioned to attract more listings. We have included a snapshot of the FIC deregulation and its potential impact, as analysed by MIDF Research in this newsletter.

This year’s Invest Malaysia conference also saw a shift from the norm. A plenary session with the Menteri Besar of Johor and the Chief Ministers of Penang and Sabah saw a healthy discourse on the attractive investment propositions of their respective states. We hope the session gave the audience a keener insight into the development of these states as contributors of the economy.

You can also read more about the inaugural Corporate Governance Week organised by the Securities Commission and Bursa Malaysia, which is slated to be an annual affair. This week-long conference saw prominence given to corporate governance as a key cornerstone of the integrity of the capital market. Directors are also able to learn more about a Guidebook launched by the Exchange to aid them in the understanding of their roles and responsibilities.

There has been a lot of interest in knowing more about the Islamic offerings of the capital market and we have attempted to give you a snapshot of these offerings. We hope this, and the other articles compiled in this issue will give you beneficial information and updates on the Malaysian capital market.

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marked his first address to the investment community. The Prime Minister announced 3 key policy areas:

Liberalisation of fund management and i) stockbroking;Deregulation of FIC Guidelines; andii) GLCs’ divestment of non-core businesses.iii)

Delegates also had the opportunity to attend all the plenary sessions which discussed timely market issues and ideas that will shape the country’s future business landscape. This year’s sessions included a special address by Tan Sri Azman Mokhtar, Managing Director of Khazanah Nasional Berhad. Other sessions entitled “Malaysia: Vision, Execution & Consistency” and “Islamic Finance: Driver of Growth” featured stimulating discourse between renowned industry captains and market players, overseen by a panel of expert moderators.

For the first time, the conference also included a session by the Menteri Besar of Johor and the Chief Ministers of Penang and Sabah, who showcased the attractiveness of their respective states as key investment destinations.

For more details on the FIC Deregulations made at the IM09, click here.

MARKET HIGHLIGHTS

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The Main and ACE Market

The Main and ACE Markets will be introduced on 3 August 2009 with the objective of allowing efficient access to capital and investments for Malaysian and foreign corporations. This move is aimed to further enhance Bursa Malaysia as apreferred listing and investment destination.

The new structure marks a significant shift in the regulatory approach towards a more market-based regime where greater empowerment will be given to the market, with emphasis placed on market and self-discipline.

Enhancements have been made to the listing requirements of the Main Market (Main LR) and ACE Market (ACE LR). This includes the provisions to enable the listing of Special Purpose Acquisition Companies (SPACs) which are shell companies without operations that go public with the intention of acquiring businesses with their IPO proceeds. Both Markets, together with the Main LR and the ACE LR, will become effective on 3 August 2009. However, requirements related to structured warrants, real estate investment trusts, listings denominated in multi currency and shareholding spread are effective immediately.

Copies of Main LR and ACE LR are available on Bursa Malaysia’s website.

REGULATION UPDATES

Raising the Standards of Corporate Governance

The inaugural Corporate Governance Week 2009 organised by the Securities Commission (SC) and Bursa Malaysia that was held in June was a resounding success. The SC Chairman, Tan Sri Zarinah Anwar officiated the event together with Bursa Malaysia’s Chairman, Tun Mohamed Dzaiddin Bin Haji Abdullah.

Wider Investment Options with Multi-Currency Trading

Bursa Malaysia recently launched its multi-currency securities framework on 13 July 2009 to support the listing, trading, clearing and settlement of securities in non-Ringgit. The new framework supports primary non-Ringgit listings or cross listings from other stock exchanges and is one of the initiatives expected to expand the Exchange’s accessibility in attracting more issuers and investors to the Malaysian capital market. The framework will help diversify investors’ investment portfolio, especially those who are looking into foreign denominated assets.

The implementation of this multi-currency securities framework will be able to support the growing interest of domestic and foreign issuers in listing regional Exchange Traded Funds (ETFs) in a common global currency such as US Dollar or Euro. It is also expected to help promote the potential for regional linkages which involves settlement in common currencies as well as support the listing of any type of securities in non-Ringgit. A copy of the circular and the FAQ on multi-currency trading is available here on Bursa Malaysia’s website.

Improving Market Efficiency with Market Making Framework

Bursa Malaysia implemented the Market Making Framework for Exchange Traded Funds (ETFs) and Structured Warrants. This framework is aimed to provide a regularised platform and level playing field for market makers (MM) to carry out market making activities in ETFs and structured warrants. The market making framework is also formulated as such that it can be extended to cover market making of other securities as and when required.

The market making framework provides an avenue for local and foreign participations, where eligible corporations are admitted to Bursa Malaysia as MMs through a registration process. Through this framework, qualified foreign MMs can market make from offshore centres without having to set up offices in Malaysia.

A MM will provide competitive two-way quotes for an expected time presence by quoting a minimum bid and offer size within a certain price spread. A MM who is not a Participating Organisation (‘PO’ i.e., a stockbroker), will be required to route the orders through a PO.

A copy of the amendments to the Rules of Bursa Securities on the Market Making Framework is available here on Bursa Malaysia’s website.

MARKET HIGHLIGHTS

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REGULATION

The Corporate Governance Week was a platform to exchange information, experience and knowledge on CG matters through dialogues, seminars and roundtables with the objective of raising the standards of Corporate Governance practices.

The event saw involvement from industry associations such as the Institute of Internal Auditors Malaysia (IIAM), Malaysian Institute of Accountants (MIA), Malaysian Institute of Chartered Secretaries and Administrators (MAICSA) and Association of Chartered Certified Accountants (ACCA). Advocates and proponents of Corporate Governance such as the Malaysian Institute of Corporate Governance (MICG), Malaysian Institute of Integrity (IIM), Minority Shareholder Watchdog Group (MSWG) and Malaysian Alliance of Corporate Directors (MACD) also participated in the week-long programme.

Launch of the Corporate Governance Guide

As part of its on-going initiative as a front-line regulator to maintain high standards of corporate governance and quality of market, Bursa Malaysia launched the Corporate Governance Guide: Towards Boardroom Excellence during the Corporate Governance Week.

The Guide is intended for directors of listed companies to gain a clear and constructive direction on corporate governance best practices. It focuses on bringing clarity to the roles and requirements needed to enhance corporate governance practices among their boards and committees, which will contribute towards the achievement of their strategic goals and values in their businesses.

MIA and IIAM will organise trainings for directors to familiarise themselves with the Corporate Governance Guide.

A copy of the guide can be downloaded from Bursa Malaysia’s website.

The Revamped Regulation Web Section

The revamped Regulation web-section of Bursa Malaysia was launched concurrently with the Corporate Governance Guide on 8 June 2009. This web-section offers listed issuers, market participants and investors comprehensive information relating to the exchange’s regulation approach, philosophy, rules and regulatory actions that are relevant to the Malaysian capital markets.

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Innovators of ICM Products and Services Recognised as the pioneer in the global Islamic financial market, Malaysia holds the distinction of being the world’s first to have a full-fledged Islamic financial system. With its physical infrastructure, regulatory framework, internationalconnectivity, communication network, product and cultural offerings, as well as talents, Malaysia has the leading edgein the Islamic financial landscape.

With unflagging support from the Malaysian Government, initiatives of Malaysia International Islamic Financial Centre(MIFC) and the Securities Commission of Malaysia, Bursa Malaysia is committed in delivering excellence and choicesthrough innovation, accessibility and sustainability, as well as positioning itself as the forerunner in Islamic investments. Bursa Malaysia offers a holistic range of innovative Islamic Capital Market (ICM) products from equities, commodities to debt securities across all sectors and industries.

Shariah-Compliant Stocks88% of the securities listed on Bursa Malaysia are Shariah-compliant and represent two-thirds of Malaysia’s market capitalisation. (Source: Securities Commission @ May 2009). At Bursa Malaysia, choices are abundant as investors have access to an extensive selection of Shariah–compliant stocks across diversified industries for broader and deeperinvestment portfolios.

Islamic Equities IndicesLaunched on 22 January 2001, the FTSE Bursa Malaysia EMAS Shariah Index is a broad based benchmark designed to provide investors with a guide to companies that passes the Securities Commission’s Shariah Advisory Committee (SAC) screening standards.

The tradable FTSE Bursa Malaysia Hijrah Shariah Index was subsequently launched on 21 May 2007 to cater to the requirements of international Islamic investors. This index consists of the 30 largest constituents which pass the triple screening process namely by the FTSE Bursa Malaysia screen for investability and tradability, and screening by SAC and FTSE’s Shariah partner, Yasaar Ltd.

By leading the way in Shariah-compliant indices, Malaysia is well positioned to carve itself as a key player in the provision of Islamic capital market services and products within the international markets.

Shariah-Compliant ETFBursa Malaysia is the first in Asia to list an Islamic ETF which is the Dow Jones Islamic (DJIM Malaysia Titan 25) index which tracks the 25 largest blue chip listed companies in Malaysia that comply with Shariah investment guidelines. Shariah ETF is an excellent alternative for investors who are seeking Shariah-compliant investment instruments. With 88% of the securities listed on Bursa Malaysia being Shariah-compliant, Bursa Malaysia is perfectly placed to create a variety of Islamic ETFs that are transparent and

cost effective, providing greater access for investors to efficiently diversify their investment portfolios.

Islamic REITsMalaysia is the pioneer in the Islamic financial universe to introduce Islamic REITs guidelines (by the Securities Commission). This kick started the iREITs industry in Malaysia with the Al-Aqar KPJ Reit (Al-Aqar) taking the honour of being the first ever iREIT in the world to be listed on Bursa Malaysia. This was followed by the introduction of the Al Hadharah Boustead Reit (Al-Hadharah) which is the first ever plantation REIT on the exchange. AXIS REIT converted from a conventional REIT to an Islamic REIT.

SukukThe sukuk market has been the driver of growth for the Malaysia ICM with many world’s first issues, cemented by a sizable amount of innovative structures. Malaysia is one of the largest sukuk issuance centres in the world and accounts for approximately two-third of the global sukuk issued. Issuing sukuk in Malaysia is cost effective as international issuers have the flexibility to issue either Ringgit or Non-Ringgit denominated sukuk using international documentation, based on the UK or US laws with the choice of international credit rating agencies. Issuers also have the choice of listing sukuks onshore or off-shores, either on Bursa Malaysia or Labuan International Financial Exchange respectively.

Ongoing InnovationBursa Malaysia is in the final stage of developing a scalable, user friendly, multi-commodity and multi-currency commodity trading platform which conforms to international Shariah rules. This system will enable various permutations of how Murabahah is done by the market. The connectivity to the system is via internet, thus making it more accessible for market players. Commodity Murabahah House is a spot commodity trading infrastructure with clearing, depository and settlement mechanism, to enable the structuring of various Shariah-compliant financial products, using Crude Palm Oil (CPO) as the first underlying commodity.

The development of a commodity house is a collaboration of Bank Negara Malaysia, the Securities Commission, Bursa Malaysia and Islamic financial institutions under the leadership of the Malaysia International Islamic Financial Centre (MIFC). The Commodity Murabahah House is imperative to support the current murabahah transactions by the Islamic Financial Institutions.

ISLAMIC CAPITAL MARKET

KNOW MORE ABOUT MALAYSIA’S ISLAMIC CAPITAL MARKET

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ISLAMIC CAPITAL MARKET

Number of Shariah-compliant securities as at 30 June 2009 845

% to total listed securities 88%

Market capitalisation as at 30 June 2009 (RM billion)

Shariah-compliant 521.24

Total market capitalisation 817.94

% of Shariah-compliant to total market 64%

Equity Market Indices

31 Dec 2007

31 Dec 2008

30 Jun 2009

KL Composite Index (KLCI) 1,445.01 876.75 1,075.24

FBM EMAS Shariah 10,533.10 5,949.63 7,445.71

FBM Hijrah Shariah 11,660.11 6,640.64 8,133.37

DJIM Malaysia Titan 25 n/a 538.48 642.06*

YearM-cap of Islamic

Equities (RM billion)

% of M-cap Islamic Equities

2001 303.2 65.22002 290.5 60.32003 383.9 59.92004 448.2 62.12005 439.8 63.32006 548.4 64.62007 705.1 63.72008 426.4 64.2

Source: Securities Commission, Bloomberg, IV Cap Management Sdn Bhd & Information Services Business Unit

Shariah-Compliant Securities on Bursa Malaysia

Number of approved ETF Jan 08 Dec 08 Jun 09

Shariah based 1 1 1

Total Industry 3 3 3

Net Asset Value (NAV) of approved funds

Shariah based (RM mil) 825.22 482.73 584.81

Total Industry (RM mil) 1347.94 1022.91 1,104.57

% total industry 61.2 47.2 52.94

Number of approved REITs Dec 07 Dec 08 Jun 09

Shariah based 2 3 3

Total Industry 13 13 13

Market Capitalisation

Shariah based (RM mil) 1376.24 1241.04 1,488.01

Total Industry (RM mil) 5249.56 4070.02 4,612.46

% total industry 26.2 30.5 32.3

* As at 29 May 2009Source : Bloomberg & Information Services Business Unit

Source : Securities Commission

Source : Securities Commission & Information Services Business Unit

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LABUAN INTERNATIONAL FINANCIAL EXCHANGE (LFX)

Bursa Malaysia Group also operates an offshore Exchange, Labuan International Financial Exchange (LFX). Based in Labuan, this offshore exchange facilitates the listing and trading of various financial instruments and securities denominated in non-Ringgit, which are based on both conventional and Islamic principles (sukuk).

The LFX is established under the offshore regulatory framework and is regulated by the Labuan Offshore Financial Services Authority (LOFSA).

LFX is a web-based exchange that operates via a system called @LFX system that can be accessed through the Internet. Its trading hours are:

24 hours and 7 days a week Trade Bids and Offers• L• icensing and Listing applications

09.00 - 17.00 (Labuan Time) Trade Initiation/Confirmation•

The clearing, settlement and depository functions of LFX are performed by Citibank Worldwide Securities Services (CWSS) and Deutsche Bank Malaysia Berhad (DBMB).

For more information about LFX, please contact Mohd Adha Thangarajah B. Abdullah, Manager-Offshore Markets/LFX, Market Operations at +603 2034 7191 or visit: www.lfx.com.my

ISLAMIC CAPITAL MARKET

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20022006

2003 200520042007 2008 2009 (June)

LFX Number of Listings LFX Market Capitalisation (USD billion)20022006

2003 200520042007 2008 2009 (June)

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Dato’, firstly, I wish to congratulate you on the recent launch of Star Publications (M) Bhd’s investor relations website. We are pleased to see more listed companies in Malaysia putting greater emphasis on investor relations.

How do you see your investor relations website Qas part of your overall corporate engagement with shareholders and investors?

Star had been engaging shareholders, investors and Aanalysts since our IPO in November 1995 mainly through one-on-one meetings and some group briefings. Our recently launched investor relations website is another platform for such communications but it has the additional advantages of immediacy and reach.

Investors are coming back into the market, albeit Qcautiously. Do you see this as an opportune time to communicate with shareholders and investors?

Whether good or bad times we should be open to Acommunicate with shareholders and investors and various other stakeholders. In fact, I think communication is of great importance during bad times as concerned stakeholders want to know what is happening to our business operations and the impact of the economic environment on the company’s performance and prospects. They don’t appreciate if we only talk during good times and turn off during the bad. It is analogous to being transparent with both good and bad news about the company. This is the essence of good corporate governance.

As a business media that reports on corporate Qnews over the years, do you see listed companies in Malaysia placing more emphasis on corporate disclosure and shareholder engagement?

Yes and no. I think there is a tendency for the popular Aand business press to give more editorial space to the ‘bigger’ names. The same is with the sell-side analysts who tend to pick ‘darling’ stocks. These ‘preferred’ stocks can easily see value in greater resource allocation to corporate disclosure and shareholder engagement. The smaller listed companies may have to do things on a smaller scale. Sometimes the profile of the shareholders and shareholdings influence the

level of engagement and corporate disclosure. But with increasing awareness of the need for greater corporate governance there should be more voluntary disclosures.

In your role as both a listed company as well as a Qmarket commentator, what would your advice be for other listed companies on their investor relations?

First, there must be a buy-in. Boards of listed companies Ashould attach greater significance to investor relations as this is enshrined in the Malaysian Code of Corporate Governance. They should consider various strategies to promote greater visibility about their companies, products or services and business operations. The essence of investor relations is ‘the business tells the story’. A good story needs to be told and the investor relations website is a good channel. Listed companies should make more effort to ‘speak up’ using various media platforms. I suggest they also advertise – about their business products, brands, market position and homepage. It is not only good for business it is good for creating more awareness about the company as an investment opportunity.

“ZOOMING INTO OUR CORPORATE PICK: Star Publications (M) Bhd”

An interview with Dato’ Clement Hii Chii Kok Executive Deputy Chairman of Star Publications (M) BhdBy Eddie Razak, CEO of Malaysian Investor Relations Association

MALAYSIAN INVESTOR RELATIONS

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SECURITIES

SECURITIES MARKET As at 30 June 2009

As at 30 June 2008

KLCI 1075.24 1186.57Market Capitalisation (RM billion) 817.94 901.24No. of PLCs 960 986No. of Listed REITs 13 13No. of Listed Call Warrants 56 111No. of Central Depository System (CDS) Accounts (million) 3.9 3.8No. of Securities Immobilised in CDS (billion shares) 426.5 409.7No. of Companies in CDS* 1,166 1,157* The number of companies in CDS comprises both listed and de-listed companies whose shares are being maintained in the CDS

2Q09 2Q08No. of Rights & Bonus Issues Credited into CDS 4 16No. of ROD Produced 4,338 5.,732No. of New CDS Accounts Opened 42,398 51,813Daily Average Trading Volume – OMT & DBT (million shares) 1,684.40 570.26Daily Average Trading Volume – OMT (million shares) 1,635.94 517.41Daily Average Trading Value – OMT & DBT (RM million) 1,559.66 1,324.28Daily Average Trading Value – OMT (RM million) 1,489.67 1,186.46No. of New Listed Call Warrants 14 14No. of IPOs (including REITs) 1 6Total Fund Raised (RM billion) 5.30 2.51No. of Trading Days 64 63No. of Delisted Companies 10 9

For more market information, click on the following:

M ✽ arket StatisticCMDF - Bursa ✽Malaysia Resesarch Scheme (CBRS)Listed Commpanie ✽ sTrading Participant by ✽Category of Investor

SECURITIES MARKET SNAPSHOT 2Q09

Year %

31-Dec-98 23.1

31-Dec-99 21.8

31-Dec-00 19.5

31-Dec-01 18.5

31-Dec-02 18.1

31-Dec-03 18.1

31-Dec-04 21.2

31-Dec-05 21.6

31-Dec-06 24.2

31-Dec-07 26.2

31-Dec-08 21.3

Foreign Ownership Figure Based on Market Value

Monthly - 2009 %

January 20.9

February 20.8

March 21.0

April 20.7

May 20.5

June 20.7

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SECURITIES

Information Package:-

We also offer a wide range of products and services for our investing public. To learn more, kindly click on the following:

Investor ✽ InformationHistorical Informatio ✽ nBursa Statio ✽ n

Market Velocity

FTSE Bursa Malaysia Index Series

85

100

115

130

145

160

Apr-09 May-09 Jun-09

Month

Value (rebased to 100)

FTSE Bursa Malaysia 100 FTSE Bursa Malaysia Large 30

FTSE Bursa Malaysia Mid 70 FTSE Bursa Malaysia Small Cap

FTSE Bursa Malaysia EMAS FTSE Bursa Malaysia Fledgling

FTSE Bursa Malaysia EMAS Shariah FTSE Bursa Malaysia Hijrah Shariah

FTSE Bursa Malaysia Second Board FTSE Bursa Malaysia MESDAQ

FTSE Bursa Malaysia Palm Oil Plantation FTSE Bursa Malaysia Asian Palm Oil Plantation(USD)

FTSE Bursa Malaysia Asian Palm Oil Plantation(MYR)

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DERIVATIVES

Volume (Total Market, FKLI, FCPO)

Open Interest (Total Market, FKLI, FCPO)

Category 2007 2008 Apr-09 May-09 Jun-09

Foreign Institutions 42% 37% 20% 21% 23%

Domestic Institutions 2% 2% 3% 2% 3%

Foreign Retail 0% 0% 0% 0% 0%

Domestic Retail 41% 46% 51% 51% 54%

Locals 15% 15% 26% 26% 20%

Proprietary 0% 0% 0% 0% 0%

TOTAL 100% 100% 100% 100% 100%

Category 2007 2008 Apr-09 May-09 Jun-09

Foreign Institutions 18% 20% 16% 16% 18%

Domestic Institutions 22% 15% 18% 17% 17%

Foreign Retail 1% 1% 0% 1% 0%

Domestic Retail 34% 38% 24% 25% 26%

Locals 25% 27% 42% 41% 39%

Proprietary 0% 0% 0% 0% 0%

TOTAL 100% 100% 100% 100% 100%

Cir. No. 26/2009 Amendments to Rules (29/06/09)

Amendments to Rules of Bursa Malaysia Derivatives Bhd pertaining to change in name of Kuala Lumpur Composite Index (KLCI) to FTSE Bursa Malaysia Kuala Lumpur Composite Index (FBM KLCI).

Changes in Margin Rates

Market Demography (FKLI)

Cir. No. 15/2009 Derivatives Direct Market Access (03/04/09)

Revision of values prescribed for Pre-Trade Risk Filters. The follow-ing updates will be implemented with effect from 06 April 2009 in our continuous effort in promoting a fair and orderly market.

Market Demography (FCPO)

Cir. No. 22/2009 Cancellation of Trades (19/05/09)

Cancellation of trades done outside non-busting-range (NBR) due to mistakes of participants. This is to highlight scenarios whereby error trades may be cancelled upon request of the Participant.

Summary of Circular Issued

DERIVATIVES MARKET SNAPSHOP 2Q09

Only the major circulars are featured above. To access circulars relating to regulatory issues, please click here. For other circulars, please click here.

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KLCI Futures Crude Palm Oil Futures Exchange Total

Spot MonthGross Margin

Rate (RM)

Outright Margin (RM)

Spot Month Spread (RM)

Back MonthSpread (RM)

FCPONew 01/07/09 7,250 7,000 N/A 750

Previous 09/06/09 6,250 6,000 N/A 750

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FAQs/UPDATESFBM KLCI Index – Changes to KLCI Futures (FKLI)With effect from 6 July 2009, the Kuala Lumpur Composite Index (KLCI) was converted and is now known as FTSE Bursa Malaysia KLCI.

Salient features of the FTSE Bursa Malaysia KLCI are:C1. onsist of 30 constituents of the FTSE Bursa Malaysia Large 30 Index.Adopt the FTSE Bursa Malaysia index calculation methodology.2. Computed by FTSE every 15 seconds.3. Index value remains unchanged and will retain the KLCI index closing value on 3 4. July 2009.

Review of KLCI Futures (FKLI) Contract SpecificationsExample:On 3 July 2009 (prior to conversion)

F ✽ KLI futures contractUnderlying is KLCI index ✽100 underlying stocks ✽Underlying index calculation is every 1 minute ✽Assume closing is 1070 points ✽Margin is RM3500 ✽

On 6 July 2009 (after conversion)

F ✽ KLI futures contractUnderlying is FBM KLCI index ✽30 underlying stocks ✽Underlying index calculation is every 15 seconds ✽Index opening will be 1070 points (no change) ✽Margin remains at RM3500 ✽Change to Final Settlement Value calculation methodology. Details can be found ✽by clicking the link of the contract specifications below.

For the revised FKLI contract specifications, please click here.For more details on the amendments to the Rules, please click here.

DERIVATIVES

For more derivatives information, click on the following:

Product ✽ sVolume & Open ✽InterestMarket Demograph ✽ yCircular ✽ s

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MEASURES IMPACTAcquisition of equity stakes, mergers and takeovers:

FIC guidelines on the acquisition of equity stakes, • mergers and takeovers repealed

FIC will no longer process share transactions nor • impose equity conditions on such transactions

FIC will also no longer process property transactions, • except where it involves dilution of Bumiputera or Government interests

Equity conditions for investments if any will continue • to be imposed by the relevant sector regulators

Listed companies will no longer be subject to equity • conditions post-IPO. Upon IPO, the equity condition will be subsumed as part of the public spread requirement

The deregulation of FIC is expected to remove existing bottlenecks • in the approval system and speed up the process as the need for the FIC‘s nod is no longer required. However, notwithstanding the deregulation, the national interest in terms of strategic sectors will continue to be safeguarded through sector regulators. Specifically equity conditions will remain in regulated sectors involving the Energy Commission, Commercial Vehicles Licensing Board, National Water Services Commission, Malaysia Communications and Multimedia Commission.

In sector such as telecommunication, the foreign shareholding limit • will therefore remain capped at 49%. Currently, Digi is 49%-owned by Telenor SA of Norway, while TM and Axiata have foreign shareholdings of less than 5% respectively.

However the repeal of the FIC guideline may create more M&A interests • in certain sectors, most notably the oil & gas sector. Companies in the sector are currently trading at discounted valuation, via-a-vis the rich valuation that they attracted before the global financial crisis. It will be an opportunity for foreign oil & gas players to fast-track the localisation of their operations. In the property sector, there will be an opportunity for foreign players to create a landbank in Malaysia, subject to the dilution consideration as announced.

Treatment of fund raising by listed companies:

FIC’s Bumiputera equity requirement (30%) is • removed

SC’s 25% public spread requirement Maintained•

50% of public spread to be offered to Bumiputera•

No equity condition imposed post IPO except in • the case of RTO and backdoor listing

This effectively reduced Bumiputera’s equity requirement from 30% to • a minimum of 12.5%. More importantly, by ensuring that the general bumiputra public is included in any fund raising exercise, it enhances transparency with regard to the distribution at the primary level.

The removal of equity conditions post-IPO will overcome the current • practice of bumi shares being placed to a nominee instead of bona fide bumi shareholder.

Nevertheless, the equity market may be disappointed that the • bumi equity requirement in not completely liberalised.

Source: MIDF Research (Equity Beat; Weds, 1 July 2009)

FAQ on Liberalisation of Equity Holdings in Capital Market Intermediaries, please click here.Source: Securities Commission

INVESTING FOR BEGINNERS. LET US GUIDE YOU!Clueless about investing in the stock market? The answers to all your queries is just one click away, Investing in Bursa Malaysia.

Disclaimer: Bursa Malaysia does not make any recommendation or endorsement regarding any securities or derivatives products identified in this newsletter. Please seek the advice of professionals, as appropriate, in respect of the evaluation of any specific securities or derivatives product, index, report, opinion, advice or other content.

Whilst Bursa Malaysia endeavours to ensure that the contents in this newletter are accurate, correct or have been obtained from sources believed by Bursa Malaysia to be accurate and reliable, please take notice that all information is provided on an “as is” basis without warranties of any kind and Bursa Malaysia hereby disclaims all express, implied and statutory warranties of any kind to the recipient of this newsletter and/or any third party.

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