22 Muharram 1433
BUTTERWORTH, Dec 17 , 2011- Former prime minister Tun Dr Mahathir Mohamad today challenged Opposition chief Datuk Seri Anwar Ibrahim to show a letter purportedly written by him to the World Bank for funds during the financial crisis in 1999.
Dr Mahathir said on the contrary he was the one who had refused the World Bank funds.
"I know that if we had accepted the World Bank funds, we will become its slave. Hence, we did not do so," he said after opening the third Multaqa Wehdatul Ummah here Saturday.
Dr Mahathir was commenting on Anwar's allegation that the former prime minister had written to the World Bank for funds during the financial crisis in 1999.
"If Anwar's allegation is true, please show me the letter. I challenge him to swear by the Quran in a mosque and I'm willing to do so if needed," said Dr Mahathir.
He said Anwar was known for advocating measures introduced by the World Bank and the International Monetary Fund (IMF) in tackling the financial crisis at that time.
"I used to tell him (Anwar), if we were to take the World Bank funds, we will not have enough money to pay the salaries of our officers. But he was bent on advocating the World Bank measures to the extend that it clouded his thinking," said Dr Mahathir.
Meanwhile, Tan Sri Nor Mohamed Yakcop, who was present, said he could vouch for Dr Mahathir that the former prime minister had rejected the World Bank funds.
Nor Mohamed said he could still remember that a World Bank representative came to see Dr Mahathir to discuss on how Malaysia could avoid the financial crisis in 1999.
"The World Bank representative had proposed to Dr Mahathir to increase housing loan interest rates and restrict government's spending while Bank Negara should withdraw all loans to avoid economic crisis.
"But Dr Mahathir told him that the proposals would cause bloodshed in the streets and he said let it be bloods in the streets, much to Dr Mahathir's chagrin," Nor Mohamed said, adding that Dr Mahathir told him off and told him to leave the office.
Source- BERNAMA
Saturday, December 17, 2011
Thursday, December 15, 2011
Target-volatility Strategies, A Response To Current Investment Dilemma
20 Muharram 1433Hijrah
By Tengku Noor Shamsiah Tengku Abdullah
SINGAPORE, Dec 15 ,2011- Insurance companies and pension funds have traditionally played an important role as providers of long-term risk capital and, in a world of deleveraging credit institutions, are crucially needed to finance economic development.
However, recent and forthcoming changes in accounting and prudential standards encourage long-term institutional investors to invest in low-risk assets that are highly correlated with liabilities.
Meanwhile, in the current low-interest rate environment, institutional investors cannot meet their future obligations out of the yields on these instruments.
At the same time, risk-based capital charges and financial reporting standards penalise assets that offer high-risk premia and make it expensive for long-term investors to directly hold volatile assets.
In a new study entitled "Structured Equity Investment Strategies for Long-Term Asian Investors" conducted with the support of Societe Generale Corporate & Investment Banking, Stoyan Stoyanov, Head of Research at EDHEC Risk Institute-Asia and professor of finance at EDHEC Business School, examines the dilemma of how to extract risk premia while limiting exposure to downside risks.
The study looks at the control of volatility as an objective and assesses various strategies to pursue this goal: a fixed mix of equity and risk-free assets, dynamic allocation between these assets targeting a fixed volatility, traditional portfolio insurance implementing a capital guarantee, and a target volatility strategy overlaid with a capital guarantee.
The empirical focus on Asian equity markets is justified not only by the region's importance in the shifting balance of economic power but also by the higher volatility of these markets and the difficulty of hedging in the absence of local volatility derivatives.
Research results show that a target-volatility strategy allows for effective management of volatility and that it both significantly reduces the downside risks and improves the upside potential compared to a fixed-mix strategy.
It also augments investors' access to the upside potential when a capital guarantee overlay is applied. Furthermore, the explicit management of volatility is found to reduce the cost of capital protection.
The study also documents utility gains for risk-averse investors regardless of the presence of a capital guarantee overlay and argues that significant allocations should be made to structured equity investment strategies with volatility targeting.
The study has important practical implications for long-term investors. Though evidence is taken from examining Asian equity markets, the results are applicable in other regions and for asset classes that exhibit similar characteristics.
EDHEC-Risk Institute is part of EDHEC Business School, one of Europe's leading business schools and a member of the select group of academic institutions worldwide to have earned the triple crown of international accreditations.
Societe Generale is one of the largest European financial services groups.
Source- BERNAMA
By Tengku Noor Shamsiah Tengku Abdullah
SINGAPORE, Dec 15 ,2011- Insurance companies and pension funds have traditionally played an important role as providers of long-term risk capital and, in a world of deleveraging credit institutions, are crucially needed to finance economic development.
However, recent and forthcoming changes in accounting and prudential standards encourage long-term institutional investors to invest in low-risk assets that are highly correlated with liabilities.
Meanwhile, in the current low-interest rate environment, institutional investors cannot meet their future obligations out of the yields on these instruments.
At the same time, risk-based capital charges and financial reporting standards penalise assets that offer high-risk premia and make it expensive for long-term investors to directly hold volatile assets.
In a new study entitled "Structured Equity Investment Strategies for Long-Term Asian Investors" conducted with the support of Societe Generale Corporate & Investment Banking, Stoyan Stoyanov, Head of Research at EDHEC Risk Institute-Asia and professor of finance at EDHEC Business School, examines the dilemma of how to extract risk premia while limiting exposure to downside risks.
The study looks at the control of volatility as an objective and assesses various strategies to pursue this goal: a fixed mix of equity and risk-free assets, dynamic allocation between these assets targeting a fixed volatility, traditional portfolio insurance implementing a capital guarantee, and a target volatility strategy overlaid with a capital guarantee.
The empirical focus on Asian equity markets is justified not only by the region's importance in the shifting balance of economic power but also by the higher volatility of these markets and the difficulty of hedging in the absence of local volatility derivatives.
Research results show that a target-volatility strategy allows for effective management of volatility and that it both significantly reduces the downside risks and improves the upside potential compared to a fixed-mix strategy.
It also augments investors' access to the upside potential when a capital guarantee overlay is applied. Furthermore, the explicit management of volatility is found to reduce the cost of capital protection.
The study also documents utility gains for risk-averse investors regardless of the presence of a capital guarantee overlay and argues that significant allocations should be made to structured equity investment strategies with volatility targeting.
The study has important practical implications for long-term investors. Though evidence is taken from examining Asian equity markets, the results are applicable in other regions and for asset classes that exhibit similar characteristics.
EDHEC-Risk Institute is part of EDHEC Business School, one of Europe's leading business schools and a member of the select group of academic institutions worldwide to have earned the triple crown of international accreditations.
Societe Generale is one of the largest European financial services groups.
Source- BERNAMA
Tuesday, December 13, 2011
Malaysian Economy Not Affected By Eurozone Crisis, Says Second Finance Minister
18 Muharram 1433 Hijrah
KUALA LUMPUR, Dec 13 ,2011 - The eurozone debt crisis has not affected the Malaysian economy, said Second Finance Minister, Datuk Seri Ahmad Husni Hanadzlah.
He said the country was on track to achieve next year's economic growth target of between five and six per cent despite the global economic uncertainty.
"In terms of our position, we are now focusing on domestic demand such as investment, which we are doing well currently.
"What would affect us, if there is a global recession, is our exports -- our link to the world," he told reporters after the "Hadiah Sako 3 Bagi Novel Nasional" prize-giving ceremony and book launch here today.
However, he hoped, that the EU governments would find a solution to end the eurozone crisis immediately.
Ahmad Husni said for this year, Malaysia would be able to achieve the projected five per cent growth rate, given that a lot of the government projects had been kicked-off in the first half of this year.
Source- BERNAMA
KUALA LUMPUR, Dec 13 ,2011 - The eurozone debt crisis has not affected the Malaysian economy, said Second Finance Minister, Datuk Seri Ahmad Husni Hanadzlah.
He said the country was on track to achieve next year's economic growth target of between five and six per cent despite the global economic uncertainty.
"In terms of our position, we are now focusing on domestic demand such as investment, which we are doing well currently.
"What would affect us, if there is a global recession, is our exports -- our link to the world," he told reporters after the "Hadiah Sako 3 Bagi Novel Nasional" prize-giving ceremony and book launch here today.
However, he hoped, that the EU governments would find a solution to end the eurozone crisis immediately.
Ahmad Husni said for this year, Malaysia would be able to achieve the projected five per cent growth rate, given that a lot of the government projects had been kicked-off in the first half of this year.
Source- BERNAMA
Friday, December 9, 2011
Governor Denies Nomura's Report On European Banks' Exposure To Malaysia
13 Muharram 1433 Hijrah
KUALA LUMPUR, Dec 9, 2011- Bank Negara governor Tan Sri Dr Zeti Akhtar Aziz today denied a report by Nomura International, which stated that the European banks' exposure to Malaysia amounted to US$50 billion (RM155 billion) or about 19 per cent of the country's gross domestic product.
"That is not correct information. What I really want to emphasise is our foreign banks are locally incorporated and therefore they have less exposure compared to other places where they are not locally incorporated.
"We'll issue the numbers because that's not correct. It's something like less than five per cent or so, it's very low," she told reporters when asked to comment on the issue after launching the central bank's MobileLink here today.
An economist at Nomura International, an asset management company, stated recently that Malaysia was one of the economies that would weaken the most as it was in the economies weaker group.
The economist also said Malaysia ranked third in Asia, excluding Japan, in terms of exposure to European bank claims after Hong Kong and Singapore, which could mean drying up of liquidity should European banks start cutting their exposure to the region.
Zeti also urged the public to report to the central bank and the police on scam activities.
"We don't want to wait until it's serious before we inform the public that there are these scams. It's not just telling people who are not involved in the financial sector but people who are already in the financial mainstream, that means participating in the financial system.
"They don't have the knowledge that some of these are scams and it is important to be educated," she said.
Zeti also said there were all kinds of financial wealth products and a lot were not correct.
"Sometimes they use Bank Negara letterheads and names of Bank Negara senior officials. All these, of course, can be charged (in court) and the public should report them not only to Bank Negara but also to the police," she added.
Source- BERNAMA
KUALA LUMPUR, Dec 9, 2011- Bank Negara governor Tan Sri Dr Zeti Akhtar Aziz today denied a report by Nomura International, which stated that the European banks' exposure to Malaysia amounted to US$50 billion (RM155 billion) or about 19 per cent of the country's gross domestic product.
"That is not correct information. What I really want to emphasise is our foreign banks are locally incorporated and therefore they have less exposure compared to other places where they are not locally incorporated.
"We'll issue the numbers because that's not correct. It's something like less than five per cent or so, it's very low," she told reporters when asked to comment on the issue after launching the central bank's MobileLink here today.
An economist at Nomura International, an asset management company, stated recently that Malaysia was one of the economies that would weaken the most as it was in the economies weaker group.
The economist also said Malaysia ranked third in Asia, excluding Japan, in terms of exposure to European bank claims after Hong Kong and Singapore, which could mean drying up of liquidity should European banks start cutting their exposure to the region.
Zeti also urged the public to report to the central bank and the police on scam activities.
"We don't want to wait until it's serious before we inform the public that there are these scams. It's not just telling people who are not involved in the financial sector but people who are already in the financial mainstream, that means participating in the financial system.
"They don't have the knowledge that some of these are scams and it is important to be educated," she said.
Zeti also said there were all kinds of financial wealth products and a lot were not correct.
"Sometimes they use Bank Negara letterheads and names of Bank Negara senior officials. All these, of course, can be charged (in court) and the public should report them not only to Bank Negara but also to the police," she added.
Source- BERNAMA
Firms Must Explore New Business Models To Face Media Digitisation Challenges
13 Muharram 1433 Hijrah
By Tengku Noor Shamsiah Tengku Abdullah
SINGAPORE, Dec 8 , 2011- Companies need to be open in exploring new business models, collaborative partnerships and develop new capabilities to deal with the challenges of media digitisation.
James Kang, assistant chief executive in the government chief information office at Infocomm Development Authority of Singapore (IDA), said with the proliferation of consumer devices such as tablets, connected televisions and smartphones, the demand for digital content and services would continue to increase.
He said IDA was looking at ways to help the industry tap these monetisation opportunities.
"As companies move towards digitisation of their processes and services, the demand for manpower skilled in these new areas will increase.
"IDA welcomes the industry to leverage on its manpower development programmes," he said in his address at the Digital Marketplace Forum here Thursday.
Kang said to enable the media industry to flourish, IDA also recognised the need for online protection policies to provide a conducive environment for companies to monetise their content.
"Currently, in consultation with the industry, a multi-government agency effort is in place to study measures to improve online content protection in Singapore," he said.
Source- BERNAMA
By Tengku Noor Shamsiah Tengku Abdullah
SINGAPORE, Dec 8 , 2011- Companies need to be open in exploring new business models, collaborative partnerships and develop new capabilities to deal with the challenges of media digitisation.
James Kang, assistant chief executive in the government chief information office at Infocomm Development Authority of Singapore (IDA), said with the proliferation of consumer devices such as tablets, connected televisions and smartphones, the demand for digital content and services would continue to increase.
He said IDA was looking at ways to help the industry tap these monetisation opportunities.
"As companies move towards digitisation of their processes and services, the demand for manpower skilled in these new areas will increase.
"IDA welcomes the industry to leverage on its manpower development programmes," he said in his address at the Digital Marketplace Forum here Thursday.
Kang said to enable the media industry to flourish, IDA also recognised the need for online protection policies to provide a conducive environment for companies to monetise their content.
"Currently, in consultation with the industry, a multi-government agency effort is in place to study measures to improve online content protection in Singapore," he said.
Source- BERNAMA
Wednesday, December 7, 2011
Malaysia Headed In The Right Economic Direction, Says Economist
11 Muharram 1433 Hijrah
By Christine Lim
KUALA LUMPUR, Dec 6 , 2011 - Malaysia is moving in the right path in terms of transforming its economy to a high-income status through the Economic Transformation Programme, even though this achievement may involve a long term process, said a prominent European economist, Douglas McWilliams.
McWilliams who is chief executive of The Centre for Economics and Business Research (Cebr) based in London said Malaysian economy has evolved from being reliant solely on export to a more diversified base with the services sector emerging to be an important economic driver.
"While economic growth will be impacted by the dismal outlook in the global economy on the backdrop of the escalating Europe sovereign debt crisis, Malaysian economic growth will be right on track with the pick up in global economy in 2013," he said during an interview with Bernama TV on Monday.
He also projected a five per cent growth for Malaysian economy this year and a decline to between 4.2 per cent and 4.3 per cent growth next year in line with global economic weaknesses.
He said Malaysia had a lot of scope in terms of fiscal expansion by the government as its debts were not huge compared with the sovereign debts in Europe.
"The key is to ensure that domestic consumption is able to fill the hole for the slowdown in export growth," McWilliams informed.
McWilliams also expects Bank Negara to continue to monitor the economic situation closely to see if there is a need for a cut in interest rates.
He said the European leaders were also working on a concrete solution to the European debt crisis.
McWilliams said domestic consumption will play a pivotal role in the Asean economy with action by governments to increase domestic consumption.
He said Asean currencies were also rising in value compared with other currencies, while western currencies were getting weaker.
He said the Western economy was also bracing for structural adjustments with higher wages and longer holidays compared to Malaysia and the rest of Asean countries.
Source- BERNAMA
By Christine Lim
KUALA LUMPUR, Dec 6 , 2011 - Malaysia is moving in the right path in terms of transforming its economy to a high-income status through the Economic Transformation Programme, even though this achievement may involve a long term process, said a prominent European economist, Douglas McWilliams.
McWilliams who is chief executive of The Centre for Economics and Business Research (Cebr) based in London said Malaysian economy has evolved from being reliant solely on export to a more diversified base with the services sector emerging to be an important economic driver.
"While economic growth will be impacted by the dismal outlook in the global economy on the backdrop of the escalating Europe sovereign debt crisis, Malaysian economic growth will be right on track with the pick up in global economy in 2013," he said during an interview with Bernama TV on Monday.
He also projected a five per cent growth for Malaysian economy this year and a decline to between 4.2 per cent and 4.3 per cent growth next year in line with global economic weaknesses.
He said Malaysia had a lot of scope in terms of fiscal expansion by the government as its debts were not huge compared with the sovereign debts in Europe.
"The key is to ensure that domestic consumption is able to fill the hole for the slowdown in export growth," McWilliams informed.
McWilliams also expects Bank Negara to continue to monitor the economic situation closely to see if there is a need for a cut in interest rates.
He said the European leaders were also working on a concrete solution to the European debt crisis.
McWilliams said domestic consumption will play a pivotal role in the Asean economy with action by governments to increase domestic consumption.
He said Asean currencies were also rising in value compared with other currencies, while western currencies were getting weaker.
He said the Western economy was also bracing for structural adjustments with higher wages and longer holidays compared to Malaysia and the rest of Asean countries.
Source- BERNAMA
Saturday, December 3, 2011
Remisiers Association To Seek Fresh Avenue To Standardise Brokerage Fee
8 Muharram 1433 Hijrah
By Santhia Panjanadan
KUALA LUMPUR, Dec 3 , 2011 - The Remisiers Association of Malaysia (Persama) will continue to seek avenues to standardised transaction cost in order to manage irregular stock price behaviour.
President Sam Ng Soon Lee said the absence of a standardised brokerage fee was one factor that prolonged capital flow bottleneck and loss of confidence among the investing public.
Persama and the Association of Stock Broking Companies had on June 13 agreed on a standardised transaction cost but this was verbally turned down by the Securities Commission.
"We disagree with the current method of brokerage liberalisation," he told Bernama after the association's annual general meeting here today.
At present, the fee structure was to the advantage of local and foreign fund managers and to the disadvantage of retail participants.
"If trading participants believe the current rate is too high, then how low do they want the fee to be?.
"It is unfair to go to zero rate to manage listed companies price volatility as it would result in malpractices and loss of confidence," he added.
Source- BERNAMA
By Santhia Panjanadan
KUALA LUMPUR, Dec 3 , 2011 - The Remisiers Association of Malaysia (Persama) will continue to seek avenues to standardised transaction cost in order to manage irregular stock price behaviour.
President Sam Ng Soon Lee said the absence of a standardised brokerage fee was one factor that prolonged capital flow bottleneck and loss of confidence among the investing public.
Persama and the Association of Stock Broking Companies had on June 13 agreed on a standardised transaction cost but this was verbally turned down by the Securities Commission.
"We disagree with the current method of brokerage liberalisation," he told Bernama after the association's annual general meeting here today.
At present, the fee structure was to the advantage of local and foreign fund managers and to the disadvantage of retail participants.
"If trading participants believe the current rate is too high, then how low do they want the fee to be?.
"It is unfair to go to zero rate to manage listed companies price volatility as it would result in malpractices and loss of confidence," he added.
Source- BERNAMA
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