KUALA LUMPUR: The Securities Commission Malaysia (SC) has liberalised its rules governing the fund management industry by allowing the establishment of boutique fund management companies through a more facilitative structure.
In a statement yesterday, it said parties with niche fund management expertise can be licensed as boutique fund management companies with a paid-up capital of RM500,000, compared with RM2 million for a full-fledged management licence. “In line with the SC’s regulatory philosophy that advocates proportionality of regulation, licensing requirements are tiered according to the size and scale of business and clientele. Boutique fund management companies can manage assets of up to RM750 million with a clientele of not more than 50 sophisticated investors.”
It now allows fund management companies to provide investment advice to clients. Marketing, sales and client servicing activities by fund management companies can be done by representatives registered with the SC and licensed representatives. It also introduced restricted dealing licences for securities and over-the-counter bonds via online platforms, giving wider access to the capital market.
“As at May 2015, total assets under management ... stood at RM662 billion from RM377 billion in 2010. The fund management industry is the fastest growing ... in the capital market, with a compound annual growth rate of more than 10% over the last five years,” it noted.
This article first appeared in The Edge Financial Daily, on July 9, 2015.