Press Conference Statement (2) by Parliamentary Opposition Leader, DAP Secretary-General and MP for Tanjung, Lim Kit Siang, in Penang on Monday, 6th May 1990 at 11.30 a.m.
Call on KLSE to revert to the old system of payments and receipts to be fair to the small investors
The reply by the Executive Chairman of the Kuala Lumpur Stock Exchange (KLSE), Nik Mohamed Din Nik Yusuff , that “administrative delays” was the reason why the KLSE could not notify broker immediately on the Bank Negara’s new directive on new margin trading is the lamest excuse I have ever heard.
What are these ‘administrative delays” which caused the KLSE to withhold the Bank Negara directive on new margin trading for three weeks, when he directive dated March 16 made it very clear to Nik Mohamed that he should inform all stockbroking companies” as soon as possible” of the new Bank Negara directive, which is to take effect on April 15?
“Administrative delays” can cause delays of three or four days, or even one week. But when the delay is as long as three weeks, then it can no more be “administrative delays” but gross incompetence and inefficiency, as well as giving cause to query as to whether KLSE committee members had caused their position and office by withholding the Bank Negara directive for such an inordinate length of time.
This is why on 25th April, at a press conference in Penang, I called for an independent inquiry as to whether KLSE Committee members had abused their position and office in withholding the new Bank Negara directive limiting margin trading for three weeks before informing all stockbroking companies.
I want Nik Mohamed to explain why the KLSE Committee is afraid to have such an independent inquiry to clear its name and establish its integrity, if the KLSE Committee has nothing to hide?
KLSE probably one of the most incompetent in the world
The KLSE Committee is probably one of the most incompetent in the world. The missing scrips problem is still unresolved, creating havoc in the stock market and untold hardships to the small investors.
Under the new system introduced by the KLSE Committee, a small investor who sells shares only gets his money on the sixth trading day, whereas under the old system, he gets his money on the afternoon of the following day.
If he buys, he must pay by the seventh trading day, although he is not sure whether he could get the scrips or not. I understand that there are small investors who had bought shares in February under the new system introduced by the KLSE, who have not got their scrips yet. Under the old system, the small investors pay only when they get their scrips.
For the best interests of the small investors, the KLSE should revert to the old system of payments and receipts, as well as contra trading.
The new system was introduced as a ‘crisis management’ when the KLSE was unable to cope with extraordinary volume of trading early this year, when the volume of trading reached a peak of over 200 million shares a day. Today, it has shrunk to 20 million shares.
The very fact that the KLSE Committee is not prepared to consider on its own a reversion to the old system of payments and receipts shows that the KLSE Committee is unrepresentative and not looking after the interests of the small investors.
The KLSE Committee at present is firstly, a gang-up of the big broker against the small brokers, and secondly, a gang-up of the brokers against the small investors. The KLSE Committee should be reconstituted to ensure that there is a representative who represents the small investor interest and the public interest.
I will raise the issue of the KLSE’s gross irresponsibility and negligence in withholding the Bank Negara directive on new margin trading to brokers, and its failure to protect the best interest of the small investors, when Parliament meets next month.
DAP supports the Speaker’s proposal to fill the Deputy Speaker’s post and suggest that it should be filled by an Opposition MP
The Speaker of Dewan Rakyat, Tan Sri Zahir Ismail, has proposed that the vacant post of Deputy Speaker caused by the resignation of D.P. Vijandran, should be filled.
DAP supports the Speaker’s proposal to fill the Deputy Speaker’s post when the Dewan Rakyat meets for two weeks next month, from June 11 to 22.
DAP supports the new Deputy Speaker should be appointed from the Opposition ranks, either from the DAP or from Semangat 46. This will show that the government truly practises parliamentary democracy in Malaysia.