Strengthening resilience: Malaysia's capital market performance and outlook
Today’s accelerating pace of market changes catalyzed by technological advancements, extreme climate changes and geo-political tensions portend to a future of significant opportunities and threats for global capital markets. Against this backdrop, the future of Malaysia's capital market will be shaped by the transformative agility of industry participants in adapting to digitalization, ESG practices, as well as complying with regulatory demands.
Recently, the Securities Commission Malaysia (SC) in its Annual Report 2022 highlighted that Malaysia’s total capital market funds raised hit a record high of RM179.4 billion last year, exceeding its 5-year average of RM121.4 billion per annum.
Total capital market (equity and bonds/sukuk) funds grew 37% year-on-year (y-o-y) in 2022. The growth was driven by a record amount of corporate bond and sukuk issuances.
There was also significant growth in the alternative fundraising market which expanded 24% y-o-y to RM3 billion with the highest growth in the peer-to-peer (P2P) financing segment, which saw an increase of 38% y-o-y to RM1.6 billion.
The continued resiliency of the Malaysian capital market highlights Malaysia’s strong focus in managing risks and maintaining financial resilience and stability to support economic growth. In the medium term, building Malaysia’s market strength involves continued enhancements of digital platforms and the adoption of sustainability practices, be it in the reporting arena or across business operations.
In future-proofing the Malaysian capital market, SC intends to modernize key regulatory pillars, strengthen the alternative fundraising ecosystem and advance the environmental, social and governance (ESG) agenda.
Within a complex and rapidly changing environment, organizations can further advance the sustainability agenda through far-sighted strategies which include re-modelling business models with digitalization and ESG strategies.
