ôWe are delighted at being allowed to participate in the securities borrowing and lending (SBL) framework. ItÆs an honour to be named as the first foreign
participant of the scheme and a testament to the esteem in which UBS is held in
MalaysiaÆs capital markets,ö says Joe Cavatoni, head of equity swaps in Asia for UBS.
ôBursa Malaysia clearly understands the needs of issuers and the requirements of the investor community and the re-introduction of these measures will contribute strongly to greater liquidity and enhance the attractiveness of the Malaysian market. In addition, UBS Securities Malaysia is able to offer its clients a fuller and more comprehensive suite of products,ö he adds.
The SBL facility will be offered by Bursa Malaysia Clearing, which will act as the central lending agency (CLA). It will borrow securities from lenders and lend to borrowers. While any person who has the requisite number of stocks may lend to the CLA, only approved institutions will be entitled to borrow from it.
Bursa Malaysia has said that it plans to introduce SBL in stages and move towards securities borrowing and lending on an over-the-counter basis. Participants will negotiate the terms under which they borrow and lend, within a framework set out by Bursa Malaysia.
In September 2005, UBS was one of only five foreign brokers to be awarded foreign broker licences by the Securities Commission and became one of the first foreign brokers to start trading on Bursa Malaysia.
"UBS intends to be a key player as Malaysia further enhances its capital markets," adds Cavatoni.