KUALA LUMPUR: Despite last year’s market uncertainties Bursa Malaysia Bhd’s FY11 ended Dec 31 profit rose 29% year-on-year (y-o-y) to RM146.2 million. Revenue was up 16% to RM420.1 million.
“Our securities and derivatives markets recorded improvements in trading volume as a result of increased participation by both foreign and local investors,” CEO Datuk Tajuddin Atan told a media briefing yesterday.
For its 4QFY11 Bursa’s net profit was up 5% to RM31.3 million while revenue dropped 6% to RM95.7 million.
Foreign participation in the market for FY11 rose 57% y-o-y while domestic participation grew by 30% y-o-y, leading to higher trading volume.
Average daily contracts traded for derivatives alone were up 39% to 34,474 and Bursa’s average daily trading value improved by 14.01% y-o-y to RM1.79 billion from RM1.57 billion. This resulted in trading revenue from derivatives increasing by 36% y-o-y to RM51.25 million from RM37.64 million in FY11.
Contracts traded for the FBM KLCI Futures increased by 24% to 2.48 million from 1.99 million in 2010; crude palm oil contracts jumped 45% to 5.87 million in FY11.
The total derivatives contracts traded grew 37% y-o-y to 8.45 million in FY11, compared with 6.15 million the previous year.
Tajuddin said Bursa believes in the potential of the derivatives market which currently contributes 12% to the group’s net profit. “Our derivatives business is poised to benefit from increased risk management brought about by the global economic uncertainty,” he said.
The derivatives market is one of the three key areas Bursa will focus on as a part of its strategic direction for 2012.
Last September marked the first anniversary of Bursa’s migration onto the Chicago Mercantile Exchange (CME) Globex trading platform, which helped contribute to the increase in derivatives contracts traded.
Tajuddin said Bursa will introduce various products and systems to facilitate the growth of the stock exchange in a competitive regional scene.
“The exchange landscape grows more competitive and presents more challenges, innovation, clearing [systems]...The current system is sufficient to cater for our current business needs and we will introduce new features to introduce greater flexibility and increase additional efficiency when placing orders, ”he noted, adding that the participation structure will be revamped to bring in new market entrants.
It will introduce a new derivative clearing system by the end of 1QFY12, which will have multi-asset class, time zone and currency capabilities. Bursa will also launch a high frequency trading system, which will allow for more liquidity in the markets.
Looking ahead, Tajuddin said the group expects its FY12 results to at least mirror its FY11 results.
He added that the divestment of assets by some government-linked companies will further contribute to the liquidity and vibrancy of the market. He cited the listing of Felda as among the companies that will positively contribute to the market.
The anticipated Asean exchange initiative, which includes Bursa, will also be launched by mid-year. The collaboration will see the exchanges of Malaysia, the Philippines, Singapore, Thailand and Vietnam joining forces to promote the growth of the Asean capital markets.
Bursa proposed a final dividend of 13 sen per share for FY11, subject to shareholders’ approval next month.
Its stock closed at a six-month high yesterday, up two sen to RM7.52 on a total trading volume of 1.29 million shares.
This article appeared in The Edge Financial Daily, February 10, 2012.
“Our securities and derivatives markets recorded improvements in trading volume as a result of increased participation by both foreign and local investors,” CEO Datuk Tajuddin Atan told a media briefing yesterday.
For its 4QFY11 Bursa’s net profit was up 5% to RM31.3 million while revenue dropped 6% to RM95.7 million.
Foreign participation in the market for FY11 rose 57% y-o-y while domestic participation grew by 30% y-o-y, leading to higher trading volume.
Average daily contracts traded for derivatives alone were up 39% to 34,474 and Bursa’s average daily trading value improved by 14.01% y-o-y to RM1.79 billion from RM1.57 billion. This resulted in trading revenue from derivatives increasing by 36% y-o-y to RM51.25 million from RM37.64 million in FY11.
Contracts traded for the FBM KLCI Futures increased by 24% to 2.48 million from 1.99 million in 2010; crude palm oil contracts jumped 45% to 5.87 million in FY11.
Tajuddin expects Bursa's FY12 results to at least mirror its FY11 results.
The total derivatives contracts traded grew 37% y-o-y to 8.45 million in FY11, compared with 6.15 million the previous year.
Tajuddin said Bursa believes in the potential of the derivatives market which currently contributes 12% to the group’s net profit. “Our derivatives business is poised to benefit from increased risk management brought about by the global economic uncertainty,” he said.
The derivatives market is one of the three key areas Bursa will focus on as a part of its strategic direction for 2012.
Last September marked the first anniversary of Bursa’s migration onto the Chicago Mercantile Exchange (CME) Globex trading platform, which helped contribute to the increase in derivatives contracts traded.
Tajuddin said Bursa will introduce various products and systems to facilitate the growth of the stock exchange in a competitive regional scene.
“The exchange landscape grows more competitive and presents more challenges, innovation, clearing [systems]...The current system is sufficient to cater for our current business needs and we will introduce new features to introduce greater flexibility and increase additional efficiency when placing orders, ”he noted, adding that the participation structure will be revamped to bring in new market entrants.
It will introduce a new derivative clearing system by the end of 1QFY12, which will have multi-asset class, time zone and currency capabilities. Bursa will also launch a high frequency trading system, which will allow for more liquidity in the markets.
Looking ahead, Tajuddin said the group expects its FY12 results to at least mirror its FY11 results.
He added that the divestment of assets by some government-linked companies will further contribute to the liquidity and vibrancy of the market. He cited the listing of Felda as among the companies that will positively contribute to the market.
The anticipated Asean exchange initiative, which includes Bursa, will also be launched by mid-year. The collaboration will see the exchanges of Malaysia, the Philippines, Singapore, Thailand and Vietnam joining forces to promote the growth of the Asean capital markets.
Bursa proposed a final dividend of 13 sen per share for FY11, subject to shareholders’ approval next month.
Its stock closed at a six-month high yesterday, up two sen to RM7.52 on a total trading volume of 1.29 million shares.
This article appeared in The Edge Financial Daily, February 10, 2012.
