This article first appeared in The Edge Malaysia Weekly on December 30, 2024 - January 12, 2025
In what many would describe as a good year, especially for the local bourse, the regulators played their part in ensuring that the capital markets operated in a fair and orderly manner
Datuk Mohammad Faiz Azmi
Executive chairman of Securities Commission Malaysia
Appointed to the board of the Securities Commission (SC) in mid-August 2023, Datuk Mohammad Faiz Azmi was promoted to executive chairman in June the following year by Prime Minister and Minister of Finance Datuk Seri Anwar Ibrahim.
Faiz is no stranger to corporate Malaysia and is probably best known for his 11 years spent as chairman of auditing firm PwC Malaysia, where he retired as a partner and executive chairman.
In addition to his sound accounting credentials, Faiz also read law at the University of Durham, and was called to the Bar in the UK. He is an alumnus of Lincoln’s Inn.
Whether or not his double qualifications made him the ideal candidate for the executive chairman position at the SC, Faiz’s appointment created quite a stir given his reputation as a no-nonsense person who takes his job seriously — and perhaps, more importantly, he is not the sort to bend under pressure.
Shortly after his appointment, the regulator at end-June sought legal redress against prominent investor Datuk Dr Yu Kuan Chon for alleged market rigging and manipulation in 2018 involving shares of Shangri-La Hotels (M) Bhd (KL:SHANG), and sought a disgorgement amounting to RM26.57 million — three times the gain from the alleged manipulation. The SC also sought to impose a penalty of RM1 million and for Yu to be barred for five years from managing any public company and trading on the stock exchange.
Another move by the SC that grabbed headlines was a review of public-listed companies’ annual general meetings, which were still in full virtual format after the pandemic.
“Publicly traded companies must take necessary steps towards transitioning back to physical or hybrid meetings … After all, building trust in the capital market is crucial for attracting investments and that will also help the micro, small and medium enterprises (MSMEs) as well as the capital market in general,” Faiz said.
In short, he started his stint at the SC with a bang. — By Jose Barrock
Datuk Muhamad Umar Swift
CEO of Bursa Malaysia Bhd
In April 2019, an international news publication referred to Bursa Malaysia (KL:BURSA) in an article as “The world’s worst major stock market” after it slipped 14% from its peak in May 2018. An analyst the publication spoke to had commented, “There is nothing to be positive about over the next 12 months.”
Datuk Muhamad Umar Swift was in the hot seat then, having assumed the position of CEO of the stock market operator about two months before.
It has taken about five years, but in 2024, Bursa Malaysia appeared to have found its groove as it hosted an impressive 55 initial public offerings (IPOs), beating an initial target of 42 offerings. To put things in perspective, in 2023, there were 32 IPOs and the 55 flotation exercises this year are the highest number since 2005.
Among the IPOs that stood out was that of 99 Speed Mart Retail Holdings Bhd (KL:99SMART) — the largest, raising RM2.3 billion on the Main Market in September. It made its founder and CEO Lee Thiam Wah a billionaire.
In March, fertility care company Alpha IVF Group Bhd (KL:ALPHA) raised RM466.5 million, making it the largest IPO on the bourse’s ACE Market.
The momentum seems likely to continue, with 50 IPOs slated to take place in 2025.
On Nov 11, in a rare case of two companises — Azam Jaya Bhd (KL:AZAMJAYA) and Mega Fortris Bhd (KL:MEGAFB) — listing on the same day, Umar observed: “This surge [in IPOs] reflects a thriving capital market with strong regulatory support and a diverse investor pool. Malaysia has experienced a bull run, making us the Asean exchange with the highest number of IPOs to date this year.”
The tide appears to have turned for Bursa Malaysia. As for Umar, he is said to be looking for greener pastures as the stock exchange operator confirmed a story by The Edge on Dec 23 that he will be leaving Bursa Malaysia soon. — By Jose Barrock
Datuk Seri Abdul Rasheed Ghaffour
Governor of Bank Negara Malaysia
A key challenge for Datuk Seri Abdul Rasheed Ghaffour, who became Bank Negara Malaysia governor in July 2023, was the persistent depreciation of the ringgit against the US dollar early this year. The ringgit, among Asia’s worst performing currencies at the time, hit a 26-year low of 4.80 against the greenback on Feb 20, spurring the central bank into action.
Bank Negara, as part of a coordinated move with the government to stimulate flows into the foreign exchange market, stepped up efforts to “encourage” government-linked companies and government-linked investment companies (GLICs), as well as investors and exporters, to bring back foreign investment income and convert it into ringgit.
The moral suasion sparked debate in the market — some felt that it could have unintended consequences, including potentially lower investment income and dividends from GLICs such as the Employees Provident Fund and Khazanah Nasional Bhd — but it yielded results.
Speaking to reporters a few months later, Abdul Rasheed noted that the coordinated measures had helped the local currency appreciate 1.6% against the US dollar between Feb 26 and May 15. Prior to the implementation on Feb 26, the ringgit had declined 3.9%, he said.
After the US Federal Reserve began its easing cycle in September, which narrowed interest rate differentials between the US and Malaysia, the ringgit’s fortunes improved further and it was, for a while, the world’s top-performing currency against the greenback. At the time of writing on Dec 16, the ringgit was trading at the 4.45 level.
Bank Negara was also in the news because of its close scrutiny of the Sarawak/Affin Bank Bhd (KL:AFFIN) deal, in which the state government sought to become the lender’s largest shareholder. Observers note that the central bank did not succumb to political pressure to hasten the deal, taking care to ensure it was comfortable with all aspects before greenlighting it in September, much later than the market had expected. Shortly after, Sarawak became the first state government to have a large stake in a bank.
In 2025, there will be close monitoring of whether Bank Negara makes any change to the overnight policy rate (OPR) as the US continues with its easing cycle — although at a potentially slower pace — and as the Malaysian government cuts back on blanket subsidies, which could impact prices and growth. The OPR has held steady at 3% since Abdul Rasheed took the helm. Next year (Jan 2 to Dec 31) is also when Bank Negara starts accepting applications for digital insurance/takaful licences. — By Adeline Paul Raj
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