Chief Executive Officer's Message

a. Developing the Islamic Capital Market

One of the most inspiring features of 2008 is the continued progress which has taken place in Islamic finance and ICM. Market players, regulators and intermediaries have all been instrumental in promoting Malaysia as an Islamic financial and investment centre with innovative ideas and products.

For some years, Malaysia has had a record of leadership in ICM investment products, which includes sukuk, i-REITs and i-ETF. Bursa Malaysia will launch more Islamic products, going forward, as these are attractive asset classes for investors who seek diversification.

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As part of developing the ICM, Bursa Malaysia has appointed its own Shariah Advisor to support our products and services innovation. This spurred developments in 2008 that focused on the building of CMH which is aimed to facilitate liquidity management, product development and sukuk issuance. We are also looking at the development of an Islamic Securities Selling and Buying (ISSB) facility, a Shariah compliant shorting mechanism to support the creation and redemption of Islamic ETFs. The Islamic infrastructure that is being developed will provide an end-to-end Shariah solution, and foster the trading of Shariah compliant securities as well as the development of other Islamic products.

In December, Bursa Malaysia introduced new rules for the listing of sukuk and debt securities. Under the new framework, sukuk or debt securities denominated in Ringgit and foreign currencies issued by local and international listed and non-listed entities will be allowed to be listed on the Exchange. The requirements are comparable with practices in other exchanges that provide similar listing facilities.

To add to these, the FBM EMAS Shariah Index and FBM Hijrah Shariah Index will also contribute positively towards profiling Malaysia as an Islamic financial hub.

Bursa Malaysia's capability in pursuing innovative products that cater to market needs distinguishes us from our competitors as we are able to provide differentiation to the market and thus contribute positively to the development of the ICM.