Imagine this headline six years ago: “Come on over, Bursa tells S'pore investors”

Singapore investors would have choked on their kopi-o! It was only two years earlier that the Malaysian authorities put a stop to the Central Limit Order Book, essentially freezing S$4 bln worth of stocks in 112 Malaysian companies owned by 172,000 Singaporean investors.

But this is exactly the headline that ran in last weekend’s Business Times. Essentially, Bursa Malaysia was staging a presentation by several Malaysian companies to Singapore retail investors. This “Malaysia Day 2006” was held last Saturday at the HDB Hub in Toa Payoh.

There is irony everywhere in this tale.

First, it is an irony that the Securities Investors Association (Singapore) was not only endorsing the event, but was even organising it. SIAS was founded in order to unlock the frozen assets and return them to their rightful owners.

In Malaysia’s The Edge Daily three days earlier, David Gerald, founder, president and CEO of SIAS was quoted as saying: "Over the past nine years, investors in Singapore have been apprehensive about looking at Malaysian stocks because of the CLOB issue. We believe that it is now time to re-look at the Malaysian market. Singapore investors will therefore have the opportunity to find out the investment scene in Malaysia.”

But look more closely and you will find that it was SIAS Research Pte Ltd – the private investment arm of SIAS – which has been actively involved in the event, including conducting the marketing.

SIAS Research is run by Terence Wong, a good friend of mine with an excellent nose for a good stock and business acumen to boot. In a way, Terence embodies the renewal that is so desperately needed on the Singapore market, which tends to be dominated by the 40-something (or older) crowd. Terence joined SIAS Research from JM Sassoon. His mentor there, Lim Eng Hai, was SIAS Research’s first CEO.

It cannot be anything but a positive that this cross-border promotion is going on.

However, here is the second irony: why is the SGX not out there marketing to Malaysian investors?

The Singapore market is arguably more attractive than Bursa Malaysia. It is significantly larger with a market capitalisation of US$305.9 bln, compared to Malaysia’s US$198.3 bln (at the end of August. Source: World Federation of Exchanges). The Singapore market has had its share of malfeasance (China Aviation Oil, Accord Customer Care Solutions, Informatics) but is arguably a better regulated, more stable market than Bursa Malaysia. Just last Tuesday, the Securities Commission announced share manipulation investigations.

And yet, it is Bursa that is trying to woo Singapore retail investors.

Here’s my question: When will the Singapore Exchange be permitted to stage a similar “Singapore Day 2006” to woo Malaysian retail investors?

Clearly it’s a positive that there is this cross-Causeway communication, not least because it indicates that the long-delayed trading link between Bursa and the SGX might finally be making some headway. But “business as usual” really means that: that even though the CLOB issue seems long resolved and forgotten, the quirks of cross-Strait relations remain.

Mark Laudi