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Market Development
Banking on better SME financing in ASEAN East Asia Forum 29 Sep 2015
Concerns about moderating economic growth and rising income inequality in ASEAN economies have brought small and medium-sized enterprises (SMEs) into the policy limelight. Arguing that SMEs have significant potential for creating jobs, some commentators are suggesting a host of industrial policies such as financial subsidies and local content rules to promote SMEs. But this risks heavy-handed state intervention in SMEs. One possible alternative is to reform access to finance for SMEs — particularly from commercial banks — in ASEAN economies. SMEs — firms with fewer than 100 workers — make up most enterprises, 74 per cent of total employment and about 41 per cent of GDP in ASEAN economies. But these contributions are not reflected in trade, where SMEs make up only 21 per cent of direct exports across the ASEAN region.
Indonesia eyeing Islamic banking boom Business World 27th Sep 2015
Indonesian teacher Nina Ramadhaniah hopes for “blessings from Allah” by opening a sharia bank account -- the sort of pious customer the world’s most-populous Muslim-majority country is praying for as it launches an Islamic finance drive. Indonesia, Southeast Asia’s biggest economy, has a Muslim population of around 225 million but this huge number of faithful has not translated into success for sharia banks, institutions required to do business in line with Islamic principles. Now regulators have launched a plan aimed at growing the sector, which currently accounts for less than five percent of banking assets, compared to a quarter in neighboring, more developed Muslim-majority Malaysia and around half in Saudi Arabia.
Traders get behind move to expand Islamic banking in the Philippines The Philippine Star 25th Sep 2015
Local traders expressed support for House Bill 5989, which aims to amend the Amanah Bank Charter to institutionalize an expanded Islamic banking system in the country. The bill, now in the House Committee on Banks and Financial Intermediaries, was authored by Rep. Sitti Djalia Turabin-Hataman of the Anak Mindanao (AMIN) Partylist. “We support all efforts meant to strengthen the Islamic banking system in the country. An Islamic banking system is `pro-poor' and is leaned to the empowerment of small and medium entrepreneurs,” said Sandra Siang, chair of the Kutawato Muslim Business Chamber. Siang leads a bloc of Muslim traders operating in Central Mindanao, some of them engaged in construction supply and grains buy-and-sell business in underdeveloped towns.
Indonesia corporate sukuk in government’s shadow GlobalCapital 23rd Sep 2015
The potential of Indonesia's sukuk market is obvious. The country had a gross domestic product of $888.5bn at the end of 2014, when it posted growth of 5%, according to World Bank data. It has a population of more than 200m people, the vast majority of which are Muslim. It also has a well-respected debt management office with a keen eye for market development. There is no reason it should not also have a vibrant Islamic bond market tapped by a diverse range of corporations. But the market has struggled to gain ground in recent years, despite sizeable gains in both Indonesia's economy and its domestic debt market. Corporate sukuk issuance in the country has certainly come a long way since Indosat opened the market with a Rp175bn ($12m) deal in 2002, but the trend has been far from steadily upward.
SGX plans new post-trade system for clearing, delivery of shares Channel NewsAsia 23rd Sep 2015
The Singapore Exchange (SGX) plans to implement a new generation post-trade system that will facilitate the clearing and settlement of trades as well as the delivery of shares, CEO Loh Boon Chye said on Wednesday (Sep 23). "The updated post-trade system will enable our local brokers to increase operational efficiency and offer differentiated services to their retail customers," he told shareholders at SGX's annual general meeting (AGM). Currently, most retail investors keep their SGX-listed shares in the Central Depository (CDP). When a trade is carried out via SGX, the shares are transferred from one CDP account to another. This is unlike the practice in some other countries where investors can trade the same shares using several different platforms and deposit the shares with various intermediaries.
BSP bats for development of capital markets The Philippine Star 22nd Sep 2015
The Bangko Sentral ng Pilipinas (BSP) said there is a need to strike a balance in guarding the country’s fiscal position as well as the development of a competitive and efficient capital markets. BSP Governor Amando Tetangco Jr. told members of the Capital Market Development Council (CMDC) there is a need for the legislative process to find a solution and at the same time avoid tax arbitrage. “Tax reform is always going to be a slippery slope. We recognize the need for the State to define and manage its fiscal position. We also believe that financial choices must be based on the intrinsic value of the products rather than on the friction costs that arise from one transaction to another. Thus, what is needed is to strike a balance between fiscal and developmental initiatives,” Tetangco said.
PHL capital market still lacks muscle Business Mirror 22nd Sep 2015
The Bangko Sentral ng Pilipinas (BSP) once again highlighted the need for a more developed capital market, entirely homegrown and sufficient to address the country’s requirements, even more so now that a regionwide integration of markets is finally beginning to take shape. BSP Governor Amando M. Tetangco Jr. reiterated this point at a recent public forum, where he said that the Philippines, as with other nations in the region, remains heavily dependent on banks when mobilizing funds to finance various undertakings. In more developed economies, entrepreneurs have much to choose as where to borrow funds for long-gestation projects, such as those required to build public infrastructure. Long-horizon projects necessarily require long-term financing that cannot be financed by bank borrowings whose investment horizon is often short term.
Asset Management
Singapore growth outlook weak, too soon for stock market recovery The Straits Times 28th Sep 2015
It's too soon to bet on a rebound for Singapore stocks, according to Samsung Asset Management, which sees little value in the shares even at the widest discount to global equities in more than a decade. The benchmark Straits Times Index is poised for a 15 per cent slide this quarter, the most since the throes of the global financial crisis in 2008. The gauge is on the cusp of a bear market, while the MSCI Singapore Index is already in one. Faltering growth in China and the prospect of higher US interest rates leave shares vulnerable to more losses, according to Mr Alan Richardson, a money manager at Samsung Asset whose South-east Asian equity fund has beaten 96 per cent of peers over five years.
Qualms over stock trading link Bangkok Post 28th Sep 2015
Success of integrated stock trading within Asean region is still far from certain as concerns that such link will blunt market participants' competitiveness against regional rivals have damped their efforts to deepen the integration. Exchanges in Singapore, Malaysia and Thailand were the first to join the so-called Asean Trading Link, a system created in 2012 allowing investors to trade on one another's markets. But the platform has not attracted not much interest, said Tipsuda Thavaramara, deputy secretary-general of the Securities and Exchange Commission (SEC). The trading link has not been active in the Thai stock exchange due to limited trading settlement system, she said.
IDX to cut transaction target on falling index Jakarta Post 28th Sep 2015
The Indonesia Stock Exchange (IDX) is to lower its targets for average daily transaction value and new companies entering the bourse this year in light of the unfavorable macroeconomic conditions. The rupiah’s volatility against the US dollar has also hit the composite index hard. Hamdi Hassyarbaini, a director of the IDX, confirmed the bourse would next month cut this year’s daily transaction target, which is currently set at Rp 7 trillion in the bourse’s Annual Work and Budget Plan (RKAT). “Given the current index movement, we will probably revise our average daily transaction [target] to Rp 6 trillion,” Hamdi said.
TBA, banks to meet on soft-loan scheme The Nation 26th Sep 2015
The Thai Bankers' Association (TBA) will on Monday meet with representatives of commercial banks to explain the conditions of the government-sponsored SME soft-loan programme, said Kobsak Duangdee, secretary-general of the association. The Bt100-billion programme will provide small and medium-sized enterprises with loans charging an interest rate of just 4 per cent under certain criteria. To ensure this scheme will be efficient, the TBA believes the banks should have a policy of supporting their SME clients. The association also wants to get feedback from each bank on possible barriers to the programme in order to solve such problems quickly, he said.
Fitch revises PH credit outlook to ‘positive’ Philippine Daily Inquirer 25th Sep 2015
International debt watcher Fitch Ratings has revised its credit outlook for the Philippines to “positive” from “stable,” signaling its intention to grant an upgrade within the next 12 to 18 months. This was in recognition of improved governance standards under the Aquino administration, which have led to stronger growth and a significant improvement in the business climate. However, Fitch’s more optimistic view may come to naught if the country deviates from its current track. Fitch said in a statement it would withhold a credit rating upgrade if it sees a “deterioration in governance standards or a reversal in reforms that were implemented under the Aquino administration.”
Indonesia Central Bank to Announce Policy Package to Support Rupiah Jakarta Globe 25th Sep 2015
Indonesia's central bank will announce new policies aimed at increasing onshore supply of dollars, as part of the second installment of a stimulus package to support the shaky rupiah. Earlier this month, Indonesia's government unveiled the first installment of a stimulus package, which analysts argue did not directly affect the exchange rate because most of the changes were deregulation measures to attract direct investment. "This part of the package we hope will be able to stabilise the exchange rate more," said Juda Agung, Bank Indonesia's (BI) executive director for monetary and economic policy, on Friday.
Year-end OFW remittances to prop up weakening peso, FMIC predicts Business Mirror 25th Sep 2015
The peso remains under pressure from a strong US dollar coupled with fears of the China economy’s hard landing, but the First Metro Investment Corp. (FMIC) sees improvement once the remittances of overseas Filipino workers start pouring in November and December. FMIC said the peso will continue to be under pressure with the imminent rise in Fed policy rates this year. It said the 30-day and 200-day moving averages continue to suggest further peso weakness in the near term. “We maintain the view that the peso will continue to be on a depreciation mode, albeit milder, as the US growth proves intact, coupled with fears of a hard landing of the Chinese economy and nervousness over the government’s abilities to restore confidence in its stock market,” according to FMIC and UA&P capital markets research.
Fitch revises PH outlook from ‘stable’ to ‘positive’ Philippine Daily Inquirer 24th Sep 2015
International debt watcher Fitch Ratings revised its credit outlook for the Philippines to “positive” from “stable,” signaling its intention to grant an upgrade within the next 12 to 18 months. Sovereign credit ratings, which are indications on the government’s ability to repay obligations, are used by investors as proxies for the strength and stability of the local economy. Fitch’s move was in recognition of improved governance standards under the Aquino administration, which has led to stronger growth, and improvements in the government’s finances and the domestic business climate. Fitch said it would withhold a credit rating upgrade if it sees a “deterioration in governance standards or a reversal in reforms that were implemented under the Aquino administration.”
SGX grilled by concerned shareholders at AGM The Straits Times 24th Sep 2015
Investors grilled Singapore Exchange (SGX) bosses on a range of issues yesterday amid some concerns over the bourse's business performance. The 600 or so shareholders clearly had plenty to get off their chests at the annual general meeting. One of the most contentious issues concerned the upcoming minimum trading price (MTP) requirement but there were also questions about the sluggish securities business, rising staff costs and director fees. One of the more vocal attendees was activist investor Mano Sabnani, who asked the SGX to be more active in guiding the stock market to meet the 20-cent minimum trading price requirement, set to fully kick in in March next year.
Investors concerned by conflicts of interest over Malaysia’s stock market rescue plan SCMP 24th Sep 2015
Investors have voiced doubts over potential conflicts of interest posed by Malaysia’s plan for an equity fund to buy “undervalued” shares, reflecting their growing unease as a scandal over an indebted state fund engulfs Malaysian Prime Minister Najib Razak. Last week, Najib announced measures to support the economy. Chief among them was a plan to infuse 20 billion ringgit into a defunct equity fund called ValueCap so that it can buy underperforming shares. Analysts and investors have raised questions over the plan. “Why is the government intervening into the private sector?” said Tricia Yeoh, chief operating officer of Malaysian think tank IDEAS. “How is the government planning to identify which companies are undervalued versus those that are sufficiently-valued?”
Indonesian Stocks at Lowest Level in Nearly Two Years as Economic Gloom Deepens Jakarta Globe 23rd Sep 2015
Indonesian stocks fell to a 20-month low on Wednesday as investors remained jittery about the country's less-than-optimistic growth forecast for next year and similarly bleak prospects in China, Indonesia's biggest trading partner. The Jakarta Composite Index closed down 2.29 percent to 4,244.427, its lowest level since December 2013. "Lack of positive sentiment triggered market players to sell as they await positive sentiment," Lucky Purnomo, an analyst at LBP Enterprises, said on Wednesday as quoted by Antara. He cited recent cuts in growth forecasts from Bank Indonesia and the Asian Development Bank as fueling fears about the country's economy.
Ringgit falls despite foreign reserves edge higher Nikkei Asian Review 22nd Sep 2015
Malaysia's foreign exchange reserves edged higher in the first two weeks of September, even as the ringgit continued to languish as Asia's worst performing currency against the U.S. dollar this year. Foreign exchange reserves at Southeast Asia's third largest economy have been declining at a monthly average of $2.2 billion over the past few months, amid concerns of a slowing economy and a political turmoil that have dragged reserves below $100 billion in July for the first time since 2010. Foreign exchange reserves rose to $95.3 billion as on September 15, data from Bank Negara Malaysia showed today. This was higher than $94.7 billion as on August 28.
Singapore Exchange faces test as China led boom fades The Star 22nd Sep 2015
The new head of Singapore Exchange Ltd, which was hit hard in its derivatives trading by China's economic slowdown, could face his toughest questions yet at an annual shareholders' meeting on Wednesday as pressure mounts to find new sources of revenue. Trading in one of the exchange's key futures contracts for Chinese shares has slumped by nearly three-fourths from a record high hit in early July, Thomson Reuters data shows, at a time when its derivatives business has been growing and contributes a rising share of its revenue. "Singapore and other exchanges will have to do some serious thinking and look at other sources to boost revenues as offshore China-focused derivatives have had their day in the sun," said a derivatives strategist at a U.S. bank in Hong Kong.
Govt Selling Bonds for Retail Investors to Plug Budget Deficit Jakarta Globe 21st Sep 2015
The governments starts selling bonds for retail investors on Monday, as part of its effort to plug the deficit in this year's state budget. The government has set the coupon on its next three-year bond at 9 percent, 125 basis points higher than the 7.75 percent for time deposit interest guaranteed by the Deposit Insurance Agency (LPS), the Finance Ministry said in a statement. Four securities firms and 17 banks will help the government sell the bonds, dubbed as ORI012, until Oct. 15. They include Danareksa Sekuritas, Reliance Securities, Sucorinvest Central Gani and Trimegah Securities. Among the banks are Bank ANZ Indonesia, Bank Bukopin, Bank Central Asia, Bank CIMB Niaga, Bank Mandiri, Bank Negara Indonesia, Bank OCBC NISP, and Bank Tabungan Negara.
Banking
Hanoi: Credit growth picks up Voice of Vietnam 28th Sep 2015
Credit in Hanoi has surged sharply, roughly doubling the average rate of the entire banking system. According to the municipal Statistics Office, total outstanding loans of the capital in the first nine months of the year is estimated to reach VND1,195.9 trillion (US$53.15 billion), up 18.3% against December last year. Short-term loans were estimated to rise 16.8% while the increasing rate of medium- and long-term loans was 20.9%. Total capital mobilisation in the period rose 11%, reaching VND1,321.8 trillion (US$58.74 billion). As the credit growth rate was much higher than that of capital mobilisation, commercial banks have to continuously increase deposit interest rates to attract depositors in a move to balance deposit and credit sources.
Bank credit floods back into housing market VietnamPlus 28th Sep 2015
According to the State Bank of Vietnam, in the first eight months of the year banking credit grew at 10.23 percent compared to 4.33 percent a year earlier. It is expected to grow at 15-17 percent this year. It might well be considered good news indicating the economy is on the mend. But there are some worries, especially since a considerable amount of money has been lent to buy or develop property, one of the four categories of borrowers with the highest bad debts as of April 30, according to the National Financial Supervision Committee. It had its genesis in the bursting of the property bubble in early 2008. By then a huge number of individuals and companies had borrowed money from the banks at interest rates as high as 25-27 percent to speculate in property.
Banks adjust to 'new normal' The Nation 28th Sep 2015
Bankers have set their sights on ways to retain profitability and ride the "new normal" of the Thai economy. Speaking at a panel discussion on the banking sector, part of the recent "IAA 2015 Investment Analysts Conference", Krieng Wongnongtaey, first senior executive vice president of Siam Commercial Bank, said gross domestic product was no longer likely to enjoy annual growth of 7-8 per cent as in the past. Under the new normal, GDP would only be able to expand by 3 per cent a year, and banking was a business that reflects the state of the economy. To adapt to this reality, SCB is in the process of changing the way it deals with small and medium-sized enterprises, he said. Krieng noted that while SCB is the country's third-largest bank, it is only fourth in terms of its share of the SME market.
Banks face biggest default since 1997 Bangkok Post 25th Sep 2015
Teesside, a gritty steel-making district in England's northeast, is almost as far removed as you can get from the steamy streets of Bangkok. The two collided this week to inflict the biggest default on Thai bankers since the Asian financial crisis. Sahaviriya Steel Industries Plc, the Bangkok-based operator of Southeast Asia's largest flat-steel manufacturing complex, reneged on 50 billion baht ($1.4 billion) of loans Monday following the failure of its four-year old UK venture. The group said it was suspending production at the Teesside plant, which employs about 2,000 people, amid a drop in prices and a supply glut stemming from slowing economic growth in China. Thailand's biggest default since Thai Petrochemical Industry Plc buckled under $3.8 billion of liabilities during the 1997 Asian crisis looks set to knock earnings at Siam Commercial Bank, Krung Thai Bank and Tisco Financial Group, which combined had extended most of credit. As they negotiate a restructuring, the three leading creditors to the company will take a hit to their current quarterly earnings that could, in the case of Tisco at least, wipe out any profit entirely, SCB Securities Co says.
Bank deposits rise to P6.8 T The Philippine Star 25th Sep 2015
Bank deposits grew 8.2 percent in the first half, boosting the total resources of the country’s banking industry, the Bangko Sentral ng Pilipinas (BSP) reported yesterday. Based on the central bank’s Report on Economic and Financial Developments for the Second Quarter 2015, total bank deposits amounted to P6.8 trillion from January to June, P500 billion higher compared to P6.3 trillion in the same period last year. The BSP said growth in deposits in the second quarter was faster than the 7.5 percent growth posted in the first quarter. Data showed savings deposits rose 8.8 percent, while demand deposits went up 13 percent in the first half. Time deposits inched up 2.9 percent during the period.
SMEs face difficulties in accessing bank loans VietnamPlus 24th Sep 2015
Only 30 percent of small- and medium- sized enterprises (SMEs) are eligible for bank loans, Deputy Director of the Central Institute for Economic Management (CIEM) Vo Tri Thanh said during a workshop held in Hanoi on September 24. Economist Nguyen Dai Lai pointed out that low credit ratings and competitiveness have hindered their access to loans. According to Cao Sy Kiem, Chairman of the Vietnam Association of Small and Medium Enterprises, bank loans have been a major capital source for SMEs. However, some are unable to fulfil legal terms while others lack the competency to utilise the money effectively.
Banks’ deposit base expands Philippine Daily Inquirer 24th Sep 2015
Money kept by the public in Philippine banks grew at a faster pace in the second quarter, mirroring the economy’s improved performance, official data showed. In a report, the Bangko Sentral ng Pilipinas (BSP) said growth was driven mainly by an increase in savings and demand deposits, which are cheaper, albeit less stable, sources of funding for local banks. At the end of June, total savings and time deposits in the banking system rose 8.2 percent to P6.8 trillion. The pace of growth was faster than the 7.5-percent expansion recorded at the end of March this year. Savings and demand deposits expanded by 8.8 percent and 13 percent, respectively, while time deposits grew by 2.9 percent during the review period. Meanwhile, foreign currency-denominated deposits owned by Philippine residents grew by 9.5 percent, year-on-year.
South Korea's Shinhan to Finalize Purchase of Two Indonesian Banks by Year-End: OJK Jakarta Globe 22nd Sep 2015
Indonesia's Financial Services Authority, or OJK, expects the acquisition of Bank Metro Express and Centratama Nasional Bank by South Korean lender Shinhan Bank to reach completion by the end of this year. Final approval would depend on the progress made by state-controlled Bank Negara Indonesia in opening a full-licensed branch in Seoul, said Irwan Lubis, deputy commissioner of banking supervision at OJK. The arrangement is part of a wider effort between Indonesia's banking regulator and South Korea's Financial Supervisory Service in improving cooperation between the two countries' banking sector. "[BNI] will receive the main license in October. The bank is currently making improvements on its Seoul branch," Irwan said.
Second year for GIZ’s small business loan program Myanmar Times 22nd Sep 2015
Three domestic banks yesterday extended their agreement with German international cooperation agency GIZ on assistance for financial sector development. The project will last another year, aiming to strengthen small and medium enterprise finance through support from experts, as well as strengthening bank staff. Local partners Kanbawza, Yoma, and Small and Medium Industrial Development Bank signed the first agreement on the project in April 2014. Officials say the small and medium loan portfolio at the three participant banks has nearly tripled in size over the past year, with structures, processes and procedures improved specifically for small-scale financing.
Vietnam lending growth may accelerate to 16.5 pct in 2015: cbank Tuoi Tre News 22nd Sep 2015
Credit growth for Vietnam's banks could accelerate to 16.5 percent this year, beating a government target and quickening from a rise of 14.16 percent in 2014, a central banker said on Tuesday. The new projection comes after banks posted credit growth of 10.23 percent in the first eight months of the year versus the end of 2014, nearly doubling the pace seen a year ago, said Nguyen Tien Dong, a director at the State Bank of Vietnam. The January-August credit growth figure compared with an expansion of 5.62 percent in the same period a year ago, Dong told a business forum in Hanoi, confirming earlier state media reports. In July, the central bank agreed to lift the 2015 credit growth target ceiling for some major lenders in a bid to boost economic growth and help stabilise the money market. The annual target for 2015 was initially set at 13-15 percent, with a view toward expansion to 17 percent if necessary.
The Banking Outlook for Vietnam International Banker 21st Sep 2015
Vietnam’s banking sector began 2015 on a positive note, with Moody’s having upgraded the financial system from “negative” to “stable” in mid-December. According to the credit-ratings agency, the improvement reflected the “increased stability in the operating environment for the banks, as well as in Vietnam’s macroeconomic situation, and a reduction in liquidity stress in the system”. Since 2012, inflation and interest rates in Vietnam have stabilised significantly, dropping from double digits to fairly constant, sustainable levels, while higher amounts of foreign direct investment (FDI), a decisive shift from deficit to surplus in the country’s current account, and new government policies specifically aimed at promoting economic stability have all played their part in providing a brighter outlook.
UOB to operate as commercial bank in Philippines The Philippine Star 21st Sep 2015
Singapore-based United Overseas Bank Limited (UOB) is set to operate as a commercial bank in the Philippines as part of the second wave of bank liberalization program in the country. Kelyn Tan of the group strategic communications of UOB confirmed the Bangko Sentral ng Pilipinas (BSP) has approved the bank’s application to operate as a commercial bank in the country. “We received approval from the BSP to establish a branch with a commercial banking license in the Philippines,” Tan said. The bank, through UOB Philippines, currently operates as a thrift bank in the country offering a full range of thrift bank products and services to individuals and corporations.
E-Payments
Mandiri aims for 5 million e-cash users Jakarta Post 25th Sep 2015
State-owned Bank Mandiri expects to have at least five million users of its cell phone application for micro-size payments by the end of this year as part of the bank’s efforts to promote non-cash transactions in the country. The bank’s electronic banking (e-banking) group vice president Budi Hartono said the target was part of its long-term plan to reach 100 million Mandiri e-cash users by 2020 as it aims for a wider use of non-cash transactions in the country. The application, categorized as an e-money service, enables users to conduct small payments as well as withdraw money from Mandiri ATMs using only their cell phone numbers. “Currently, we already have two million e-cash users, of whom one million are citizens who received direct cash aid [BLT] from the government,” Budi said at an event on Wednesday.
Insurance
Philippines: Technology seen as disrupting insurance industry Asia Insurance Review 28th Sep 2015
Smartphones, fitness armbands, global positioning systems (GPS), and other web-connected devices are seen as disruptors to the Philippine insurance industry. With GPS telling people how to drive more carefully and fitness armbands alerting them when they are exceeding the normal sugar level, more people are beginning to think they face less risk, according to a report on the Rappler news website. "There are positive and negative implications of technological advances to insurance companies," Pru Life UK President and CEO, Mr Antonio de Rosas, said on the sidelines of an insurance seminar last week.
Online insurance platform U for Life registers RM165m in sum assured The Star 25th Sep 2015
The country’s first online insurance platform U for Life Sdn. Bhd. has registered over RM165mil in sum assured since its soft launch in May. The company said the achievement signalled growing acceptance amongst Malaysians for purchasing life insurance online. U for Life Sdn Bhd is a registered corporate agent of Tokio Marine Life Insurance Bhd. The company said a recent study commissioned by the Life Insurance Association of Malaysia (LIAM) found that Malaysians are generally under-insured compared to their peers in Singapore, Hong Kong, South Korea and Japan.
IKBZ to Sell Insurance over the Internet Myanmar Business Today 24th Sep 2015
Local private insurer IKBZ Insurance Co Ltd said it will deploy online services to sell its insurance plans. IKBZ will submit a proposal to Myanmar Insurance in order to cooperate with KBZ Bank for anyone who wishes to buy insurance plans from IKBZ, U Nay Myo Aung, administrative director of IKBZ told Myanmar Business Today. “When we activate our online services, customers will be able to get insurance once payment is made via the bank. All the detailed requirements will be published online,” said U Nay Myo Aung. IKBZ Insurance Company has now finished most of its preparations for online service, he added.
Embattled MAA General Assurance Loses Business License Jakarta Globe 23rd Sep 2015
Indonesia's Financial Services Authority, or OJK, has revoked the business license of MAA General Assurance, a local unit of Malaysia's MAA Group, as the company failed to repay its debts. The decision, effective since Sep, 3, bars MAA General Assurance from engaging in insurance activities, the authority said in a recent statement. The company must next hold a general meeting of shareholders by Oct. 3 to dissolve the company, according to a 2014 law on insurance, OJK said. OJK restricted MAA General Assurance's business activities in 2012 after its solvency ratio deteriorated to minus 275 percent from 223 percent a year earlier.
More Malaysians buying life insurance online The Rakyat Post 23rd Sep 2015
The barrier to buying life insurance online seems to be fading, with U for Life Sdn Bhd chalking up RM165 million in sum assured within four months after it began offering such services in May. “There is certainly a need to increase the life insurance penetration rate in this country, and I’m confident our online insurance platform can contribute towards realising that objective,” said general manager Iskandar Ezzahuddin. He said Malaysia’s first Internet insurance platform provider has proven more people are shifting from the traditional way via agents to a paperless, simple and instant policy buying processes with just a few mouse clicks. The encouraging response from the Malaysian public has convinced the firm to invest up to RM5 million over the next 12 months to create awareness on the importance of life insurance and also to boost purchases on its platform.
Market Regulation
Singapore names Heng Swee Keat as new finance minister New Straits Times 28th Sep 2015
Singapore’s new finance minister will be Heng Swee Keat, replacing Tharman Shanmugaratnam who will remain deputy prime minister in a new cabinet, the prime minister announced on Monday, just over two weeks after winning a general election. Heng is currently education minister and was a former managing director of Singapore’s central bank. Shanmugaratnam, an international financial expert who has worked for the International Monetary Fund, will also be the coordinating minister for economic and social policies. Prime Minister Lee Hsien Loong told a news conference the new cabinet would prepare the next team of leaders to be ready to take over from him and his senior colleagues after the next general elections, due within five years.
Court of Appeal upholds SC law to be Constitutional The Star 28th Sep 2015
The Court of Appeal yesterday ruled in favour of the Securities Commission when it held that section 122(1) of the Securities Industry Act 1983 (SIA) to be constitutional. Justice Datuk Tengku Maimun Tuan Mat, in delivering the decision of the Court of Appeal stated that the section did not violate the Federal Constitution. Transmile Group Bhd's (TGB) former chief executive officer and executive director Gan Boon Aun and Khiuddin Mohd, were charged in 2007 for abetting Transmile in making a misleading statement relating to TGB’s revenue in the company’s unaudited results for the financial year ended Dec 31, 2006 under section 86(b) read together with section 122C(c) of the Securities Industry Act 1983 (SIA).
MAS rolls out tougher safeguards for retail investors Singapore Business Review 24th Sep 2015
Non-conventional investment schemes will also be regulated. The Monetary Authority of Singapore (MAS) will enhance its regulatory framework in order to provide greater protection for retail investors. Under the new framework, the MAS will expand its regulatory powers to non-conventional investment products that share features similar to capital markets products. These include buy-back arrangements of precious metals, which will be equivalent to collateralised borrowing and will be regulated as debentures under the Securities and Futures Act.
BSP charter amendments passed on second reading Business World 24th Sep 2015
Lawmakers at the House of Representatives have approved on second reading the proposed law which will infuse an additional P150-billion capital to the Bangko Sentral ng Pilipinas (BSP), among other much-awaited changes to its more than two decades old charter. During Wednesday’s plenary session, lawmakers passed House Bill No. 5875, otherwise known as the New Central Bank Act, bringing the period of individual amendments to the measure to an end and placing it a step closer to hurdling the House. The proposal amends Republic Act No. 7653 or the New Central Bank Act of 1993 or the BSP charter.
New SFI rules due year-end Bangkok Post 23rd Sep 2015
The Bank of Thailand's regulatory policies for supervising specialised financial institutions (SFIs) are expected to be unveiled in December and take effect early next year. Policies associated with state-run banks' capital, reserves, risk management, financial disclosure and governance of SFIs are being accelerated to be put into practice after discussions with the SFIs are concluded, said Ronadol Numnonda, assistant governor of the supervision group. The cabinet approved the central bank supervising SFIs last December after several state-backed banks were saddled with high bad loans due to imprudent lending.
Public debt management law under review after five years VietnamPlus 22nd Sep 2015
The Law on Public Debt Management should endorse several legal documents into law and add new content acquired through international experience, Deputy Finance Minister Truong Chi Trung told a workshop in Hanoi on September 21 reviewing five years of its enforcement. Victoria Kwakwa, Country Director of the World Bank in Vietnam, urged Vietnam to improve its fiscal policy and pledged to provide technical support to the Finance Ministry in public debt management with a view to ensure debt safety and national financial security. Participants debated ways to create a synchronous legal environment and a set of good practices in lending administration.
SEC reviewing capital rules for brokers amid market volatility Business World 22nd Sep 2015
The Securities and Exchange Commission (SEC) is set to review the capital adequacy rules covering brokerage houses at the Philippine Stock Exchange (PSE) amid renewed volatility in global stock markets. “This is one of those rules that will undergo some refinements and our [Market Securities Regulatory Department] is soliciting inputs from other experts to review the [risk-based capital adequacy] rules because this is pre-Basel 3 regulatory framework,” Armando A. Pan, Jr., officer-in-charge of the Office of the Commission Secretary, said in an interview. Basel 3 is the latest international set of standards for bank capital, which the Bangko Sentral ng Pilipinas has adopted ahead of this year’s deadline. This was devised by international policy makers in the wake of the 2008 global financial crisis wherein governments had to bail out their fallen lenders using huge amounts of taxpayers’ money.
Central Bank official responds to NLD’s call for greater autonomy Myanmar Times 22nd Sep 2015
The draft will likely be used as a basis for policy decision-making, if the party is voted into power in the upcoming November 8 election. U Phyo Min Thein, an MP for the NLD and a member of the parliamentary Banks and Monetary Affairs Development Committee, told The Myanmar Times that the independence of the CBM is little more than nominal and that its autonomy remains weak in many areas. Firstly, the CBM’s budget is heavily influenced by the government and should be entirely independent from the national budget, he said. Secondly, the President’s Office has been known to step in and make decisions on behalf of the CBM. For example, in June the President’s Office intervened amid concerns that CBM policy was moving away from the managed floating exchange rate established in 2012.
State financial agencies prods Senate to lifting bank secrecy laws Manila Bulletin 21st Sep 2015
The government’s financial managers pushed for the approval of the measure lifting the bank secrecy law in order which the Bureau of Internal Revenue (BIR) and the Department of Finance (DOF) is pushing as a means to mitigate the impact of a reformed tax system. But BIR Commissioner Kim Henares and Finance Secretary Cesar Purisima were no-shows at the joint hearing of the Senate committee on ways and means, banks and financial institutions and currencies. Both agencies suggested the lifting of the bank secrecy laws for tax evasion cases and including tax evasion as a predicate crime under the Anti-Money Laundering Act of 2001 to alleviate the projected P30-billion revenue loss they expect when the measure adjusting the income tax brackets is approved into law.
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