Keynote Speech by Y. Bhg. Dato’ Zarinah Anwar,
Chairman, Securities Commission
Monday, 30 July, 2007

YBhg Dato’ Yusli Mohamed Yusof, CEO, Bursa Malaysia, and Director, Securities Industry Development Corporation,

YBhg Tan Sri Megat Zaharuddin, Director Capital Market Development Fund,
Dr Nik Ramlah Mahmood, Senior Executive Director SC, and Director of SIDC

John Zinkin, CEO, SIDC

Tan Sri, Tan Sri

Dato’, Dato’, Datin, Datin

Ladies and gentlemen

Assalamualaikum and a very good morning to you.
1. In just over a month, Malaysia celebrates 50 years of nationhood, a celebration of our independence and half a century of social, political and economic achievements that are the envy of many.
2. The capital market is an important barometer of the economic progress that we have achieved as a nation. Today, the size of the Malaysian capital market stands at around RM1.6 trillion with an equity market capitalisation of RM1.1 trillion, and a bond market that is among the largest in the region on a GDP-adjusted basis, with outstanding value close to RM500 billion.
3. As we look forward to the August 31 celebrations, we are gathered today to acknowledge some of the pioneering spirit of Merdeka – foresight, perseverance, hard work and a quest for excellence.
4. This morning we celebrate the coming of age of an institution that despite its relative youth, has played a pivotal role in nation building, an institution that, over a remarkably short period of 13 years, has grown from a department within the Securities Commission, into a training and development institution for the capital market, that is recognised across the globe and is the envy of many.
5. Today we witness the birth of the Securities Industry Development Corporation as a corporate entity.
6. That the SIDC has clearly earned today’s rite of passage, is certainly beyond doubt. Its track record speaks for itself.
7. Most of you are familiar with the many pioneering work that the SIDC has pursued over the years. The SIDC has a reputation second to none as a leading capital market education centre for the region, and for emerging market regulators across the world. Courses conducted by SIDC are attended by market participants and regulators from Brunei to Brazil, Korea to Kazakhstan, Thailand to Tanzania.
8. The SC on our part has, since 1994, invested RM55 million in the SIDC with the express purpose of building the skills and developing the expertise of capital market participants. This has been money well invested as the achievements of the SIDC demonstrate.
9. The profile of participants attending SIDC programmes, and the regular requests it receives for partnering and collaboration from international organisations, are clear indicators of SIDC’s globally recognised reputation for excellence and professionalism.
10. For example, SIDC’s flagship programme for emerging market regulators, the Emerging Markets Programme, has attracted regulators from 50 jurisdictions across ASEAN, South Asia, Africa, Middle East, Eastern Europe and Latin America.
11. In fact, this Programme is recognised as part of the Malaysian government’s commitment to promoting South-South relations and, as a result, eligible participants are sponsored by the Economic Planning Unit’s Malaysian Technical Co-operation Programme.
12. In 2006, the SIDC launched the very successful Islamic Capital Markets Programme as part of our efforts towards developing skills that will entrench Malaysia’s leadership position in Islamic finance. This year, the programme was even more successful with 40 participants from 10 countries. Next year, the SIDC plans to introduce a series of initiatives to develop a cluster of core competences as our contribution to making Malaysia an international Islamic financial centre.
13. The SIDC’s reputation as a leading capital markets training provider has been acknowledged by international institutions such as IOSCO, the World Bank, the Asian Development Bank, the Islamic Development Bank, the OECD, and APEC which all recognise the high quality of its services and products and regularly invite the SIDC to collaborate and assist in their own development programmes.
14. Such collaborative efforts have seen the SIDC jointly running programmes involving 18 countries and 650 participants. These include technical assistance programmes in Vietnam for capital markets and bond markets training, and in Cambodia and Indonesia for training and examinations.
15. Locally, the SIDC has been a pioneer in running training and education programmes for Malaysian organisations and fellow regulators, as well as the 8,000 market intermediaries who are critical to the operations of a vibrant capital market.
16. At the same time, the SIDC has been instrumental in delivering a suite of investor education programmes aimed at upgrading the knowledge of investors, as well of their rights as shareholders. In 2006 alone, the SIDC organised 28 programmes throughout Malaysia. The SIDC’s Malaysian Investor website receives an average monthly hit rate of 1.4 million.
17. The SIDC also pioneered the Capital Markets Graduate Training Scheme. This Training Scheme has facilitated the entry of more than 500 graduates into the capital market since 2003 through a customised training scheme. The scheme has become the role model adopted by many other organisations in Malaysia.
Upgrading the skills and professionalism of capital market intermediaries is the raison d’etre of the SIDC. The licensing examinations conducted by SIDC are one of several filters used by the SC in ensuring that only “fit and proper” persons are licensed as intermediaries.
19. To ensure that these intermediaries continue to keep abreast of latest developments in the market, the SIDC launched the revolutionary Continuous Professional Education programme in 2001 pursuant to Recommendation 145 of the Capital Market Masterplan. To date, almost 50,000 participants have attended 2,000 CPE programmes accredited by the SIDC.
20. The significance of the CPE programme cannot be overstated as it represents a commitment by the SC, through the SIDC, to ensuring that all licensed intermediaries continuously develop new skills to keep them up-to-date in a rapidly changing market.
21. The SC is committed to ensuring that our capital market intermediaries are fully equipped to provide the type of services that are required in an increasingly globalised and competitive environment. It is for this reason that we are also today launching the Industry Transformation Initiative (the ITI).
22. The focus of the ITI is on changing behaviour as a result of facilitated adult learning. The measure of ITI’s success will be the resulting increased ability of intermediaries to add value to their clients.
23. Intermediaries will now have a career path based on a curriculum and different levels of certification in a professionally accredited body – just like any other profession.
24. Developing this programme has taken a great deal of time, thought, effort and money, reflecting the sustained commitment of the SC to human capital development in the capital market.
25. The ITI programme is funded by the Capital Market Development Fund as part of its efforts to improve the skills of intermediaries in the capital market. I am confident that the Industry Transformation Initiative will indeed transform the behaviour of intermediaries by delivering the level of professional excellence needed to make the Malaysian capital market the first choice for investors locally and globally.
The newly corporatised SIDC is entrusted to roll-out this initiative and you will hear more about this from John Zinkin shortly.
Ladies and gentlemen
26. The SIDC brand is an asset. It is an asset that not only has to be preserved but must be allowed to flourish and grow at an even faster rate. Indeed, the SIDC’s role is critical in enhancing the competitiveness of the Malaysian capital market and in fulfilling our aspirations to be an international financial centre
27. The SIDC is on the cusp of greater things – for itself, for the SC and, more importantly, for the nation. The SIDC is now ready to take on greater challenges in capacity building, and contribute to the development of the Malaysian capital market – and to the financial services sector in general.
28. However, such aspirations cannot be achieved by the SIDC remaining as a department within the SC. While the SC has invested vast amounts of resources to develop the SIDC over the years, as a department within the SC, there were many things that the SIDC could have done but were constrained by structure.
29. The need for the SIDC to ultimately exist as a separate entity was recognised even at its inception in 1994 and was reiterated in the Capital Market Masterplan.
30. A corporatised SIDC will seek new business opportunities unrestricted by regulatory considerations. It will also be better equipped to cater to local, regional and global demands through its new-found ability to select a wider range of partners with whom to work commercially.
31. To ensure that SIDC has a sustainable source of funds to achieve its full potential, the Capital Market Development Fund has committed a total of RM36 million to support the SIDC in running three major programs from now through to 2011.
32. Of this amount, RM24.4 million will be used to fund the new Industry Transformation Initiative.
33. The balance will be utilised for the Advanced Business Management Programme, designed to educate senior managers in the capital markets in the latest approaches to achieve business success, as well as for the Capital Market Graduates Training Scheme.
34. The SIDC is today entering adulthood, and I am absolutely delighted to launch it into its next independent phase of life.

Ladies and gentlemen, as we await the celebrations of 31 August, let us today celebrate one of Malaysia’s very own success stories – the launch of the Securities Industry Development Corporation, and with that the rolling-out of the Industry Transformation Initiative for the Capital Market

Thank you.