Further Details on Capital Market Initiatives

25 March 2008

Following the Prime Minister’s announcement at Invest Malaysia on the streamlining of Bursa Malaysia’s three boards, the Securities Commission (SC) would like to furnish more details of the proposal as follows:

Board structure

The Main and Second Boards will be merged into a unified Board for companies with an established profit track record where the qualifying criteria for listing will be based on the current Second Board criteria. T he MESDAQ Market will be transformed into a sponsor-driven market and expanded to include the listing of both technology and non-technology emerging companies.

In conjunction with the planned streamlining, a new regulatory approach for listings and fund-raising on the unified Board as well as the MESDAQ Market will be introduced. This new approach will facilitate Principal Advisers and Sponsors bringing companies to list on Bursa Malaysia and be responsible for ensuring the quality and suitability of companies for listing. In addition, for the MESDAQ Market, Sponsors will be expected to ensure on-going supervision of companies post listing.

The SC will shift its focus from assessing suitability of proposals to ensuring the adequacy and quality of disclosures in prospectuses giving due regard to corporate governance and public interest considerations.

The above measures, which are in line with international practices, will lead to a more facilitative fund raising and regulatory environment to enhance Bursa Malaysia’s position as a preferred listing destination for domestic companies as well as providing a competitive listing platform for foreign companies. The merger of the Main and Second Boards will also remove the differentiation of companies based on size and facilitate the assessment of companies on the basis of quality of earnings.

The SC will continue with its education programmes to further strengthen investor knowledge and vigilance.

The streamlined board structure together with the new regulatory and listing approach will be implemented by the end of 2008.


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