DANAVEST

by Lim Shie-Lynn, The Edge Daily

KUALA LUMPUR: Bursa Malaysia will launch a new system for equities trading on Dec 1 to replace the existing system that ran into problems in July and caused trading to be suspended an entire day.

Sources said that brokers were briefed by Bursa Malaysia recently on the new equities trading platform. A broker when contacted said that they were told that the new trading platform will go online on Dec 1.

“We hope there would not be any more delay this time,” the broker said.

A Bursa Malaysia official, when contacted, confirmed that a new trading system was going to be in place. However, the official said that the launch date has not been fixed. “The stock exchange is seeking relevant approvals from the Securities Commission.”

The official also said that Bursa had been conducting a series of test runs over the past few months for the equities trading system called Bursa Trading Securities (BT Securities).

Previously, it was reported that Bursa was looking at implementing a new platform powered by Atos Euronext Market Solutions Ltd in late July. It is a solution that Bursa was looking at long before the current system crashed on July 3. However, the incident in July is said to have added to the urgency of implementing the new system.

The new system is likely to feature real-time match orders compared with the current 10-second delay. At the same time, the online trading facilities provided by the securities firms are expected to be upgraded to a newer version of Java Runtime Environment (JRE).

The system crash on July 3 was the worst-ever technical glitch in Bursa Malaysia’s history. The back-up system also failed, drawing heavy criticism for Bursa.

It is learnt that the problem was due to human error and that the back-up sysem also failed because it was not adequately tested. Since the incident, Bursa has a new chief technical officer.

Trading on the derivatives market was also not without problems. On Sept 8, running on a new platform, the morning session of the market was suspended before trade resumed in the afternoon.

The derivatives market also suffered technical glitches earlier in March when it was unable to disseminate market data to participants.

Bursa’s launching of a new equities trading platform is long awaited. To recap, Bursa initially planned to launch BT Securities by fourth quarter 2005, which was the second phase of a major project to change the common trading platform (CTP) for all its products.

The first product to change to a new trading platform was derivatives and it was implemented in 2006. The CTP is expected to help boost trading volumes, revenue streams and will put Bursa’s trading system on par with other platforms used in stock exchanges worldwide.