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UNLOCKING THE POTENTIAL
OF OUR MARKETPLACE
DRIVING
SUSTAINABILITYAND INCLUSIVENESS
3Q 2016 Financial Results
24 October 2016
AGENDA
KEY FINANCIAL HIGHLIGHTS & MARKET PERFORMANCE
FINANCIAL REVIEW
FOCUS AREA & CONCLUSION
APPENDICES
2
KEY FINANCIAL HIGHLIGHTS & MARKET PERFORMANCE
FINANCIAL HIGHLIGHTS
9 MONTHS FINANCIAL TRENDS
SECURITIES MARKET OVERVIEW
DERIVATIVES MARKET OVERVIEW
ISLAMIC CAPITAL MARKET OVERVIEW
3
Financial Highlights
Operating revenue declined marginally year-on-year due to lower Securities trading
revenue. This drop was partially offset by higher revenue from Derivatives and Islamic
Capital Markets.
Cost to income ratio increased marginally by 1 percentage point to 47%, while ROE
declined by 2 percentage points.
9M2016 vs. 9M2015:
4
Financial Items 9M 2016
9M 2016
vs.
9M 2015
3Q 2016
3Q 2016
vs.
3Q 2015
Operating Revenue (RM million) 360.2 0.6% 111.8 8.4%
Operating Expenses (RM million) 181.4 3.8% 57.8 1.5%
PATAMI (RM million) 143.5 3.1% 44.0 14.4%
EPS (sen) 26.8 3.3% 8.2 14.6%
Cost to Income Ratio (%) 47% 1 percentage point 48% 4 percentage points
Annualised ROE (%) 24% 2 percentage points 22% 5 percentage points
14
18 18
23
26 26
24
55
50 48
45 46 46 47
237.0
296.5 293.9
335.9
362.5 360.2
82.4
112.9 114.8
139.2 145.1 148.0 143.5
9M 2010 9M 2011 9M 2012 9M 2013 9M 2014 9M 2015 9M 2016
362.5
5
9 Months Financial TrendsMarginal decline in 9M16 financial performance due to market conditions
Operating Revenue
(RM mil)
PATAMI
(RM mil)
Cost to Income
Ratio (%)
ROE (%)
29
27
1,597
1,686
9M2015 9M2016
5.6%
Securities Market OverviewPerformance of ADV influenced by market sentiments
Average Daily Value (“ADV”)
(OMT)(RM mil)
Market Capitalisation (RM bil) Fund Raised from New Listings &
Secondary Market (RM bil)
976 955
456 400
542 499
9M2015 9M2016
1,974
1,854
Velocity (%)
1,621.04
1,652.55
FBMKLCI
3.7
0.5
9.4
7.5
9M2015 9M2016
No. of New Listing
Fund raised from new listings
Fund raised from secondary market
ADV of Domestic Institutions
ADV of Retail
ADV of Foreign Institutions Market Capitalisation
9
7
38.4%
6
6.1%
8.0
13.1
12,363 11,387
44,941 47,048
248 251
9M2015 9M2016
Crude Palm Oil Futures
Volatility of Crude Palm Oil Prices
Derivatives Market OverviewFCPO continues to drive growth in ADC
OthersFBMKLCI Futures
Volatility of FBMKLCI
20%22%
16%10%
78%
21%
Average Daily Contracts (“ADC”)
& VolatilityOpen Interest (No. of contract)
80%
19%
2.0%
7
30 Sept 2015
234,675
31 Dec 2015
230,376
26 May 2016
337,267
01 Sept 2010
111,548
30 Sept 2014
319,476
1%
58,68657,552
1%
30 Sept 2016
226,309
12.3 13.6
1.5
2.8
9M2015 9M2016
13.8
16.4
18.5%
107
121
Islamic Capital Market OverviewHigher BSAS trades contributed by higher acceptance of the trading platform
18.4
23.7
14.2
29.6
30 SEPT 2015 30 SEPT 2016
35.0
53.3
No. of Shariah Compliant Stocks (%)No. of Trading Participants
Bursa Suq Al-Sila’ (“BSAS”)
ADV (RM bil)
Market Capitalisation of Shariah
Compliant Stocks (RM bil)
No. of Sukuk
Value of Listed Sukuk (USD bil)
74% 74%21
23
52.3%
Domestic Foreign Market Capitalisation of Shariah
Compliant StocksDomestic Foreign
8
1,0031,054
30 SEPT 2015 30 SEPT 2016
1.2%
FINANCIAL REVIEW
9
FINANCIAL SNAPSHOT
OPERATING REVENUE
OPERATING EXPENSES
10
51.544.0
148.0 143.5
3Q 2015 3Q 2016 9M 2015 9M 2016
122.0 111.8
362.5 360.2
3Q 2015 3Q 2016 9M 2015 9M 2016
3.1%
0.6%
8.4%
56.9 57.8
174.7 181.4
3Q 2015 3Q 2016 9M 2015 9M 2016
1.5%
Financial Snapshot3rd quarter market performance affected 9M16 financial performance
Operating revenue (RM mil) Operating expenses (RM mil)
PATAMI (RM mil)
14.4% 44
4846
47
3Q 2015 3Q 2016 9M 2015 9M 2016
Cost to Income Ratio (%)
4 percentage
points
3.8%
1 percentage
point
Operating RevenueGrowth in non-trading revenue partially offset the decline in trading revenue
11
Higher Derivatives and Islamic Capital Markets trading revenue cushioned
the lower Securities trading revenue.
Market data revenue increased due to higher number of subscribers.
Higher listing and issuer services due to higher number of corporate
exercises.
- 9.4
+ 2.8 + 0.8
+ 1.1 + 0.5 + 1.6
+ 0.3 - 0.1
9M2015 9M2016
2.9%
5.4%
362.5 360.2
(RM mil)
173.3 163.9
64.066.8
11.8 12.6
38.4 39.5
28.7 29.2
24.9 26.5
15.6 15.95.8 5.8
9M2015 9M2016
0.6%
Total
RM360.2 mil
Securities Trading Revenue
Derivatives Trading Revenue
Listing & Issuer Services
Depository Services
Market Data
Member Services & Connectivity
BSAS Trading Revenue
Total
RM362.5 mil Growth contribution by revenue:
1.8%
4.4%
Other Operating Revenue*
Note* - Other operating revenue mainly includes conference & exposition income
1.8%
6.4%
1.6%
6.8%
96.3 99.5
17.718.1
7.58.0
12.612.5
17.117.0
23.526.3
9M2015 9M2016
Total
RM174.7 mil
Total
RM181.4 mil
3.8%
Staff costs
Depreciation & amortisation
Marketing & development
IT maintenance
Service fees
Other operating expenses^
+ 3.2 + 0.4 + 0.5 - 0.1 - 0.1
+ 2.8
9M2015 9M2016
1.1%
(RM mil)
0.3% 11.8%2.7%
3.3%
Operating Expenses9M2016 operating expenses increased 3.8% YoY
Movement of expenses:
174.7
181.4
Note^ - Other operating expenses include building maintenance, administrative expenses and CDS expenses.
Staff cost increased due to annual increment.
Higher other operating expenses mainly due to a one-off consultancy fee.
5.8%
12
FOCUS AREAS & CONCLUSION
13
Highlights of 9M2016 Initiatives
Focus Areas
Moving Forward
14
Highlights of 9M2016 Initiatives
Create a More
Facilitative TRADING
ENVIRONMENT
SI 1
REGIONAL MARKETPLACE
with Global Access
(Centre of ASEAN)
Extended “Green Lane Policy” to eligible futures brokers & eligible
general clearing participants.
Enabled multi-currency fixed income instruments in web-based Electronic
Trading Platform.
Facilitate More
TRADABLE ALTERNATIVES
Launched call and put warrants over the Standard & Poor’s 500 Index.
Launched enhanced 3-Year, 5-Year and 10-Year Malaysian Government
Securities Futures contract.
Launched Bursa Malaysia-i - the world's first fully integrated Islamic
securities exchange platform.
Amended Listing Requirements to raise the standards of disclosure of
Corporate Governance practices.
Launched the Equities Margining Framework.Reshape
MARKET STRUCTURE &
FRAMEWORK
SI 2
SI 3
SI 4 Launched FTSE4GOOD ASEAN 5 Index.
Signed MoU with Taiwan Stock Exchange to undertake joint study to
explore capital market opportunities.
Signed MoU with Indonesia Stock Exchange to collaborate on Islamic
financial market.
Focus Areas
15
LEVERAGE ON
ASEAN
GROWTH
LEVERAGE ON
DOMESTIC
LIQUIDITY
IMPROVING
MICROSTRUCTURE
Focus 1: Value Extraction Focus 2: Build for the Future
REVIEW
MACRO-
STRUCTURE
REVIEW
MARKET
FRAMEWORK
DEVELOP REGIONAL
PRESENCE &
NEW BUSINESS
Create a More
Facilitative
TRADING
ENVIRONMENT
Reshape
MARKET
STRUCTURE &
FRAMEWORK
SI 1
Facilitate More
TRADABLE
ALTERNATIVES
SI 2 SI 3
REGIONAL
MARKETPLACE
with Global Access
(Centre of ASEAN)
SI 4
Moving Forward
SECURITIES MARKET• The Securities Market performance continues to be influenced by global and local economic and
market developments.
• Domestic liquidity continues to provide support to the equity market given Malaysia’s resilient
and strong economic fundamentals.
DERIVATIVES MARKET• Derivatives Market activities will continue to be influenced by volatility in commodity prices and
the FBM KLCI.
ISLAMIC CAPITAL MARKET• Transactions on Bursa Suq Al-Sila’ are expected to be sustained with the demand for Murabaha
contracts to aid liquidity management.
• The introduction of Bursa Malaysia-i, the world’s first fully integrated Islamic securities exchange
platform, is expected to further attract a wider pool of both domestic and foreign investors.
The Exchange remains cautiously optimistic on its performance for the year, and shall continue with
its initiatives in making the Malaysian equity and derivatives markets more attractive and vibrant.
16
Securities Market Trading Activity
Securities Market Trading Participation
Securities Market Foreign Ownership
Foreign Inflow/Outflow
Derivatives Market Activity
Derivatives Market Demography
Islamic Capital Market Activity
17
APPENDICES
615
1,490 1,266
1,099
1,435 1,209
1,387
1,793
2,161
1,579
1,732
1,341
1,841
1,439 1,595
1,430 1,643
2,308
2,002
1,686
2,068 2,053
2,196
1,901 2,081
1,913 1,933 2,042 1,981
1,842 1,740
1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16
23
48
36
28
35
2831
37
42
3034
27
34
27 2825
28
37
31
25
30 29 3028
3028 29 30 29
27 26
2023
34 32
25
32
53
34 34 3333
2830
2930
27
350 472 748
874 718
1,019
2,179
1,181 1,129
1,454 1,699
1,573
1,915 2,053 1,991
1,854
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 9M16
Turnover Velocity (%)
Quarterly ADV Traded & Velocity
Average Daily Value Traded (OMT, RM mil)
Average Daily Value Traded (OMT, RM mil)Turnover Velocity (%)
Annual ADV Traded & Velocity
Securities Market Trading Activity
18
346
806
283 369 392
442354
424
530464
400
6663
76
6773 74
77 7874 77 78
34 37 24 33 27 26 23 22 26 23 22
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 9M16
65 6358
73 73 74 74 74 7673 73
35 37 42 27 27 26 26 26 24 27 27
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 9M16
From 2006 to 2009, the statistics were based on Brokers’ submission. From 2010 onwards statistics were based on Bursa’s internal
system.
Retail
(%)
Institutions
(%)
Local
(%)
Foreign (%)Retail ADV Traded
(RM mil)
Foreign ADV
Traded (RM mil)
Retail vs Institution Foreign vs Local
Securities Market Trading Participation
357
806
496
323392
437 404507 492
544 505
19
Securities Market Foreign Ownership
22.3
23.1
24.4
24.0
24.3
24.124.0
24.1 24.1
23.7
23.423.3
23.1
22.8 22.8
22.5
22.3 22.322.5
23.023.0 23.0
22.8
23.0 23.0
22.8
Based on Market Capitalisation (%)
Note: Previously, foreign shareholdings are computed based on the investor’s country of incorporation. To be more reflective of the
actual foreign shareholdings in the equity market, from January 2016 onward, the foreign shareholdings are computed based on the
nationality of investors. On this basis, we have adjusted all the numbers above accordingly.
20
Foreign Inflow/Outflow
Monthly foreign inflow/outflow from 2011 to 2016
-8,000-6,000-4,000-2,000
02,0004,0006,0008,000
2015
TNFO: RM19.7 bil2011
TNFI: RM2.0 bil
2012
TNFI: RM13.6 bil
2013
TNFI: RM2.6 bil
2014
TNFO: RM6.9 bil
TNFI: Total Net Foreign Inflow
(RM mil)
TNFO: Total Net Foreign Outflow
-2,374
608
-844 -1,193 -1,001
432
6,065
428
-4,282
-1,760
1,0211,605
-315
-6000
-4000
-2000
0
2000
4000
6000
8000 Monthly foreign inflow/outflow from Sept 2015 to Sept 2016(RM mil)
9M16
TNFI: RM2.19 bil
21
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
9M
16
1Q
10
2Q
10
3Q
10
4Q
10
1Q
11
2Q
11
3Q
11
4Q
11
1Q
12
2Q
12
3Q
12
4Q
12
1Q
13
2Q
13
3Q
13
4Q
13
1Q
14
2Q
14
3Q
14
4Q
14
1Q
15
2Q
15
3Q
15
4Q
15
1Q
16
2Q
16
3Q
16
66
85
159
125
156
123132
152
214
196 196
230 226
18%
129
115
114
132
136
162
171152
174
146
172
214
196
213204
196
218
239
288
196
207
229235
283293
226230
32
Quarterly Average Daily Contracts (’000)
3734
28
54
Total Annual Contract (mil)
Crude Palm Oil FuturesOthersOpen Interest (’000)
19%
80%
2.6 2.5
4.2
6.2 6.1 6.1 6.2
8.4
FMBKLCI Futures
24
`
`
82%
2325
3531
4042 44 45
42
9.6
46
10.7
42
50
Derivatives Market Activity
44
12.5
5655
60
51
14.1
6258
10.8
22
62
1%
56
31 19 14 16 16 13 15 15 20 21 19 15 18 20 18 15
45
48
45 43 4040
41 46
52 4442
2828
2423
20
3
6
53
32
2
2
3
22
21 2
5
3
14
23
3137 40
45 4237
2633
37
55 53 54 5562
(%)FKLI
40 38 35 33 3531
25 2736 34 34 36 33 34 31 29
1521
2624
2327
3438
2726 24
1917 15
1516
4
6 43 2 1 1
1
11
1 11 1
2721 18
20 22 25 22 15 17
1513
12
10 15 21 20
14 14 17 20 18 16 18 20 1925 28
3239
35 32 34
(%)FCPO
Local
Domestic Retail
Domestic Institutions
Foreign Institutions Local
Domestic RetailDomestic Institutions
Foreign Institutions Foreign Retail
Derivatives Market Demography
23
Islamic Capital Market Activity
24
0.8 0.9 1.1 1.1 1.3 1.5 1.6 1.8 2.6 2.4 2.7 3.2 3.7 3.7
5.9
8.5
10.4
12.0
14.4
16.9 16.1
12.7 12.2
0.2 0.2 0.2 0.3 0.3
0.7
0.9 1.2
1.1 1.0 1.1
1.5 1.4 1.5
1.4
1.4
1.5
1.6
1.6
2.1 2.6
2.7 3.0
1Q
11
2Q
11
3Q
11
4Q
11
1Q
12
2Q
12
3Q
12
4Q
12
1Q
13
2Q
13
3Q
13
4Q
13
1Q
14
2Q
14
3Q
14
4Q
14
1Q
15
2Q
15
3Q
15
4Q
15
1Q
16
2Q
16
3Q
16
BSAS Average Daily Value
Local ADV Foreign ADV
(RM bil)
www.bursamalaysia.com
RASMONA ABDUL RAHMAN
603-2034 7175
Disclaimer :
Bursa Malaysia and its Group of Companies (the Company) reserve all proprietary rights to the contents of this Presentation.
Whilst the Company endeavours to ensure that the contents in the presentation booklet are accurate, complete or have been obtained from sources
believed by the Company to be accurate and reliable, neither the Company nor the Presenter make any warranty, express or implied, nor assume any legal
liability or responsibility for the accuracy, completeness or currency of the contents of this Presentation.
In no event shall the Company be liable for any claim, howsoever arising, out of or in relation to this presentation booklet to the recipient of this
presentation booklet and/or to any other third party.
© Bursa Malaysia 2016
E-mail : [email protected]
ADRINA CHE AHMAD
603-2034 7488
RAFIDAH AZIZ
603-2034 7262
INVESTOR RELATIONS CONTACT INFORMATION