The establishment of a RM420 million Consolidated Capital Market Compensation Fund is a significant development which we hope will boost investor confidence and catalyse greater retail participation in the capital market. The current framework is fragmented into four separate compensation regimes and not aligned with the single licensing framework which allows a Capital Market Services Licence holder to carry out more than one regulated activity under one licence. As investors find themselves in a more integrated market, in which intermediaries distribute or provide advice on a wide range of retail financial products and services, there is a need for a stronger and more consumer-friendly compensation system to protect the investing public.
The establishment of a Capital Market Task Force under the leadership of the Minister of Finance 2 will help address a number of priority issues identified in the CMP2 which cut across the market, straddling dimensions that lie beyond the direct purview of the SC and Bursa. The SC will be the secretariat to the Task Force.
The establishment of a CMDF-funded Foundation under the chairmanship of Tan Sri Dr Wan Abdul Aziz bin Wan Abdullah, the Secretary-General of Treasury, will address some of the growth gaps identified in the CMP2, particularly with respect to capacity building. The Capital Market Development Fund, a statutory trust fund created under the Capital Market and Services Act 2007, will earmark RM100 million to fund the Foundation’s projects and initiatives that are in line with the CMDF’s statutory mandate.
SECURITIES COMMISSION MALAYSIA
