SEC Quarterly Review 

Jan-March 2002 


Thailand Securities Depository ready for 100% scripless in early 2002: The Thailand Securities Depository, which has been scripless system since 1992, is ready to go 100% scripless by early 2002.

Currently 47% of securities listed on the SET have already entered into the scripless system. The Thailand Securities Depository has thus been working  on developing the system in anticipation of the increasing number of shares under the scripless system in the future.

Korea Stock Exchange launches new product- Real Eestate Investment Trusts and Equity Option Market : The Korea Stock Exchange Launched trading of REITs (Real Estate Investment Trusts) on 3 December 20001. The trading and settlement system of the REITs are the same as those of stocks.

The Korea Stock Exchange has also launched an Option Market for individual stocks on 28 January 2002 to provide investors with diversified investment and risk management tools. The stock option contract months are three consecutive near –term months plus one nearest month from the quarterly cycle

Korea Stock Exchange expands quotation information disclosed: The Korea Stock Exchange has recently augmented the quantity of quote information disclosed just after the completion of trades. 

Currently the Exchange releases order information on the 5 best bid and ask quotations for all listed stocks to the public on a real time basis along with the aggregate order quantity of each trade. Since January 2002, the provision of the aggregate order quantity will be discontinued.

Instead, the scope of the bid/ask information disclosed will be expanded to 10 best bid and ask quotations. This change is designed to prevent the attempt to mislead investment decisions by placing unreasonably large orders (fake order) at the prices that are unlikely to be matched, i.e. internationally increasing the aggregate order quantity of a certain issue. 

Stock Exchange of Thailand launches new website to increase business opportunities for SMEs : The Stock Exchange of Thailand recently launched a new website which will provide business information on investments and companies that are not yet listed on the stock exchange.

The website is designed to help locate funding sources for non-listed companies, thereby increasing their business opportunities and helping  them gain greater financial viability.

Stock Exchange of Thailand allows 150 listed companies to repurchase shares: The Stock Exchange of Thailand has issued guidelines for listed companies to repurchase their shares, complementing the finance ministry regulations. These new rules have already been started from December 2001.

The ministry regulations covering share repurchasing stipulates that listed companies must show that they have accumulated profits and have the ability to repay their debts due during the next six months, starting from the day they put forward their purchase orders. Presently, there are about 150 listed companies that have accumulated profits and could potentially repurchase their shares. 

Hong Kong Stock Exchanges and Standard & Poor’s sign agreement on new index series: Hong Kong Exchanges and Standard & Poor’s, the global financial information supplier, have signed a statement of intent for the creation of a new series of  equity indexes covering stocks listed on the Hong Kong Stock Exchange.

The new main board and GEM (Growth Enterprise Market) indexes, to be co-branded as S&P/HKEx, will include the main Board’s large –cap, mid-cap, and small-cap components. All sharre listed on the exchange will be eligible for inclusion in the new index series which will be based on Standard & Poor’s Index  methodology and will follow its Global Index Classification Standard (GICS).

The goal is to develop  a series of benchmark  Hong Kong indexes, and to offer market participants more index choices.

Hong Kong Exchanges publish new survey  explaining the relationship between Exchange Traded products and OTC instruments: Hong Kong Exchanges has just published  a new educational document titled “ Exchange Traded Instruments From the Basis for OTC Products”.

The document examines the relationship between Exchange Traded Investment Products (ETFs) and their over-the-counter (OTC) market counterparts. It has been written by Dr. Joseph Fung, an associate professor in the department of finance and decision sciences at Hong Kong Baptist University’s  School of Business, and Mr. Kevin Cheng, Vice President, Market Development and Education in Hong Kong Exchanges and Clearing Business Unit.

The article explains how investors can use Exchange Traded products to replicate OTC transaction while retaining the advantages of  flexibility, daily settlements, price transparency, and the financial protection of the exchange environment.

Kuala Lampur Stock Exchange merges with MESDAQ market: At the end of December last year, the Kuala Lampur Stock Exchange signed an agreement with the MESDAQ (Malaysian Exchange of Securities Dealing and Automated Quotation) according to which the MESDAQ would join the Kuala Lampur Stock Exchange Group at the beginning of 2002.

The merger between the exchanges responds to the wish to create an efficient, cost-effective, and competitive capital market. Once the merger between the two exchanges is effective, MESDAQ will cease business as an exchange, and the new MESDAQ Market will be launched by the Kuala Lampur Stock Exchange.