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Chairman's Message
Dear Shareholders,
Some years are times of significant development and the setting of new foundations; others are times of building on those foundations. In 2010, we experienced our first full year of the new market regime with the Main and ACE markets, and our first full year under the FBM KLCI as our leading index. We also made strides on the derivatives front in our smart partnership with CME, and retained our leadership as the global listing destination for sukuk. In every respect, I am glad to say, the results were satisfactory.
In November, we introduced a Business Sustainability Programme, launched by the Honourable Prime Minister. The aim of the programme is to encourage listed companies to practise sustainability in a more meaningful way and to report effectively on their strategies and activities designed to ensure their own endurance and profitability. The Government announced ambitious plans to transform us into a high income economy, and sustainability is vital if this is to be achieved on a national scale.
 Tun Mohamed Dzaiddin bin Haji Abdullah Chairman |
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For our markets, achieving international recognition and transforming Bursa Malaysia into a globally accessible investment destination are essentials. Of the various milestones achieved in 2010, four stand out.
The promotion by FTSE of Bursa Malaysia from the previous 'Secondary Emerging Market' status to an 'Advanced Emerging Market' was confirmation that our efforts to enhance our relevance and efficiency have been recognised internationally, and our new status now gives us appeal to a wider investment audience.
In a similar vein, the recognition of Malaysia as an approved investment destination by the China Banking Regulatory Commission opens the door for large numbers of qualified Chinese institutional investors to explore investment opportunities in our markets.
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Our future depends very much on our ability to adapt to change and lead the way in innovation, especially in aspects that differentiate us from other markets like our strengths in commodities and Islamic offerings.
The successful September migration of our entire range of derivatives products onto the CME Globex® electronic trading platform makes these offerings accessible to an international audience. Separately, approvals from the US securities and commodities trading regulators have opened the way for US investors to trade directly on our markets.
Finally, our efforts to build a strong presence in Islamic financial offerings gained additional recognition. Bursa Malaysia retained its global leadership role as a sukuk listing and funding destination. Also, our unique Shari'ah compliant commodities trading platform, Bursa Suq Al-Sila', drew awards and, more importantly, a wider base of activity from an international member base.
On the matter of financial results, we achieved a profit after tax of RM113 million in 2010. After excluding the one-off gain from the disposal to CME of a 25% interest in Bursa Malaysia Derivatives in 2009, we saw a 11% increase on the normalised results achieved in the previous year. Our policy to distribute the majority of our earnings to shareholders was maintained. We paid an interim tax-exempt dividend of 9.5 sen per share and, based on our full year results, we are now proposing an additional final tax-exempt dividend of 10.5 sen. This will bring the total payout to 94% of our after tax profit for the financial year 2010.
One of Bursa Malaysia's responsibilities is to act as a model PLC. It was especially pleasing, therefore, to have performed well yet again in December's Malaysian Corporate Governance Index awards, an annual event conducted by the Minority Shareholders Watchdog Group. For the second year in a row, Bursa Malaysia was given special recognition with a Top Three (Overall) Award for excellence in corporate governance. We also achieved a Distinction Award and a Special Transparency Award, demonstrating that we do not just preach good corporate governance; we apply the practices we recommend.
Underscoring all these efforts is our continuous engagement to increase the level of awareness of the markets' offerings, as well as build the pipeline of retail investors. Our focus on younger members of the population continued with various presentations designed to explain the basics of investing and how the financial markets operate. We do this through education seminars called 'Market Chat' and 'Talk Futures'.
Internationally, we gained further recognition with our awareness campaigns where, together with key Malaysian corporate enterprises and regulatory bodies, we met with investors in Asia and Europe, to share the strengths and potential of our markets.
Sustainability is not just about protecting our markets and building our competitive position. Our challenges extend beyond creating niches or centres of excellence; we must also enhance our internal resources and capabilities. Investing intelligently in leading edge technology is an obvious example, but systems and processes are dependent on people at the end of the day. Bursa Malaysia will continue to invest, therefore, on staff development, education, talent recruitment and commensurate rewards.
We still have much to do to achieve greater vibrancy, velocity, volume and value. 2011 will see the continuation of many of the initiatives aimed at driving the attractiveness of our market.
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