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Frankly Speaking: All is not well at Bursa?

TheEdge Mon, Dec 02, 2019 02:00pm - 8 months ago

Is something rotten in the state of Denmark? That would be a fair question to ask about things that are said to be stirring over at Bursa Malaysia. There have been murmurings in recent months that chairman Datuk Shireen Muhiudeen and CEO Datuk Muhamad Umar Swift — both appointed after the change of government — are barely talking to each other. And when they do, it is said they end up in disagreements.

The Edge Financial Daily reported on Nov 22 that several top executives will be leaving and this was subsequently confirmed by the stock exchange. In a statement, Muhamad Umar said the positions of chief commercial officer and chief operating officer will be phased out to create a flatter structure.

He said the new structure will make Bursa a more agile and efficient organisation to better meet the changing needs of customers and other stakeholders, considering the evolving market conditions.

Well, we certainly hope so.

There is a lot of work that Bursa needs to do to make itself a vibrant market for current listings and IPOs.

Malaysia has been a laggard against its regional peers. Year to date, Bursa has been the worst performing market among 19 Asia-Pacific markets tracked by Bloomberg, with the FBM KLCI down around 6%.

While it is true that a stock exchange does well when the broader economy is doing well — and our economy has been rather soft lately — there are many things that Bursa itself can do to revive interest.

Reviewing some of the overly tight regulations that were implemented post the Asian financial crisis 20 years ago will be a good place to start. What was needed back then may be unnecessary today. Indeed, they could be stifling the market and may be a reason why both companies and investors are taking their business elsewhere.

On that score, Muhamad Umar’s statement seems to indicate that Bursa is aware some action needs to be taken and the reorganisation is a first step. But no amount of restructuring can make the exchange tick vigorously again unless there is internal cohesiveness. We hope the murmurings that we mentioned earlier, if true, will end soon.

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BURSA 10.600


Nadarajah Mohan
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its the darn economy ...duh!

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