The first company to offer this alternative mode of application for its IPO was White Horse Bhd. Applications for the offering opened on 26 August and closed on 9 September with computer balloting carried out on 15 September 1999.

Out of a total of 40,004 applications, 753 or 1.5% were electronic applications. Most of electronic applications were concentrated in the 1,000 to 6,000 share category with one applicant applying for 51,000 shares. The total number of shares applied for by electronic means was 2.048 million representing 2.2% of total shares applied for by the public.

The Securities Commission (SC) Chairman, Encik Ali Abdul Kadir said that the use of an electronic system for application and allotment of shares coincides with the fast growing significance of electronic commerce in the financial services in general and the capital market in particular.

He added that the SC had long recognised that developments in technology have and will continue to be a major impetus for innovation and structural change in the capital market.

"We believe that electronic commerce is an area where the regulatory infrastructure should respond in a positive and timely way to facilitate market developments and innovation in market products and processes. Indeed, the implementation of the integrated electronic system is one of the many benefits to be gained from facilitation of market development in this area, towards increasing efficiency in the capital market and to better meet investor needs at lower cost," said the SC Chairman.

The integrated electronic system, which co-exists with the existing paper-based application system, reduces the need for form-filling and queuing for cashier's orders as it provides investors with the option to use automated teller machines (ATMs) of participating financial institutions to subscribe for shares.

The system was made available at nine participating financial institutions (seven banks and two finance companies), all of which had taken part in a market simulation exercise carried out in preparation for launch of the system.

The integrated electronic system, which involves the transmission of share application data from the participating financial institutions and computerised balloting, also reduces processing time by the issuing house and facilitates the swift refund of monies to unsuccessful applicants.

Development of the system was initiated and facilitated by the SC and implemented by the Malaysian Issuing House (MIH) in conjunction with financial institutions and the Malaysian Central Depository (MCD).

This alternative mode of share application will eventually be available for all IPOs once the other issuing house, MIDFCCS, launches its integrated electronic system.