KUALA LUMPUR (June 12): Bursa Malaysia Bhd said the "approved securities" for regulated short selling (RSS) and intraday short selling (IDSS) will now require a lower minimum daily market capitalisation of RM200 million, from RM500 million previously.

Approved securities are securities that meet the criteria prescribed by the exchange, which may be used for purposes of securities borrowing and lending, and short selling.

The criteria revision, effective Monday (June 12), will boost vibrancy in securities borrowing and lending activities, which is an important component of a well-functioning capital market, Bursa Malaysia said in a statement.

The revision will offer market participants “a broader selection of approved securities aimed at meeting investors’ evolving needs”, the exchange said.

“When updating the list of approved securities, careful selection is made based on both quantitative and qualitative criteria to ensure there is sufficient liquidity, and the integrity of the market is maintained,” it added.

“By broadening access and choice for investors, we are solidifying our commitment to improving market efficiency,” said Bursa Malaysia CEO Datuk Muhamad Umar Swift.

“As a maturing market, it is vital that we offer a marketplace with robust facilities to cater to the differing needs of investors, while remaining focused on ensuring a vibrant, fair and orderly market,” Umar added.

The list, which is reviewed about every six months and last updated on Nov 30, 2022, currently has 215 companies — or more than one-fifth of the over 900 companies listed on Bursa Malaysia.

The stock exchange currently has 492 companies with market capitalisation above RM200 million, according to Bloomberg data.

According to Bursa Malaysia's website, among the requirements to be listed as approved securities is that the securities must meet the market capitalisation criteria for at least three months prior to the declaration date.

The securities must also have at least 50 million units in public float prior to the declaration date, as well as an average monthly trading volume of at least one million units for a full year.