YBhg Dato’ Siow Kim Lun
Executive Director, Securities Commission
FPAM Financial Exposition (FinEX) 2006
17 November 2006
Mr U Chen Hock, President of FPAM
Mr Steve LH Teoh, Deputy President of FPAM
Mr Wong Boon Choy, Organising Chairman for FPAM Financial Exposition 2006
Ladies and gentlemen
1. A very good morning to all of you.
2. I would like to thank the Financial Planning Association of Malaysia (FPAM) for inviting the Securities Commission (SC) to officiate the opening of the FPAM Financial Exposition (FinEX) 2006. The SC commends FPAM in its effort to provide a one-stop platform for the public to gain access to financial planners and advisors from all sectors of the financial industry. It is important for the public to understand that financial planning is a distinct, client-centric, independent advice-based process that is clearly differentiated from transactional financial services. Financial planners must therefore conduct the appropriate financial health checks on their clients to ensure that the plans and the subsequent investment products offered to their clients are best suited for them, taking into consideration the financial position and risk profile of their clients.
3. A well-informed consumer and professional adviser are requisites for a vibrant investment management environment. This is in line with the objectives of the Capital Market Masterplan 1. The SC applauds the efforts of bodies such as FPAM in not only reaching out to their clients, but also in finding new and innovative means to meet general and specialised customer needs such as in Islamic financial planning and socially-responsible investing. In this regard, the initiatives taken by FPAM together with the Islamic Banking and Finance Institute of Malaysia (IBFIM) to jointly develop the Islamic Certified Financial Planner programme have been commendable and will greatly assist the Government in its vision to make Malaysia an Islamic capital hub for the region.
4. Financial planning is an integrated professional practice that demands the highest level of technical aptitude and strategies with an equally robust set of skills and processes. The SC began licensing financial planners in 2004 when it realised that there is a strong need for a highly professional and efficient financial planning industry. In addition to the licensing requirements, there must be a clear set of fiduciary standard that is meaningfully enforced and embraced by the profession which has the confidence of the public.
5. Financial planners are entrusted with the role of helping their clients to manage their money as a resource to acquire a living standard that they want for themselves and their loved ones as well as to free themselves from financial anxiety. At present, the general public may not fully appreciate the value of financial planning advice and are less willing to pay for it. Through time and with greater awareness, we hope to see the growth of fee-based independent financial planning among the Malaysian public. In the meantime, the SC will ensure that its present framework is robust and flexible enough to promote innovative investment advice by financial planners whilst requiring the highest standard of transparency and disclosure. At the same time, the SC looks forward to the Federation of Malaysian Unit Trust Managers (FMUTM) developing and recommending a framework that enables financial planners to sell a broad range of unit trust products that meet the needs of their clients.
6. In the interim, financial planning bodies must promote a holistic approach to financial planning as opposed to one that is driven by the objectives of product pushing. Failure to do so will falter the industry’s growth as the individual needs and objectives of a consumer can never be met by generic plans. Based on this understanding, the SC together with Bank Negara Malaysia are working on a phased approach towards streamlining the current regulatory framework for financial planning activities. Upon completion of this framework, it is hoped that the regulatory requirements for financial planners and financial advisers will be streamlined.
Ladies and gentlemen,
7. The financial planning industry requires continuous consumer education for its future development. The SC appreciates the time and effort of FPAM in organising this event to educate the public and provide access to financial planning professionals throughout the industry. With more exhibitors in FinEX 2006 and the FPAM’s effort to extend this year’s event to three days as well as holding it in venues both in and outside the Klang Valley, the SC believes that FinEX 2006 will enjoy greater success in reaching out and educating the Malaysian public on financial planning.
It is our hope that this Financial Exposition event will become a permanent feature in the calendar of the financial planning industry. Thank you.
1 Objective 2 CMP – To promote an effective investment management industry and a more conducive environment for investors