Malaysia's sets two-tier broking commissions<\/p>\n
KUALA LUMPUR (AFP): Malaysia's stock exchange yesterday
\nannounced a two-tiered broker-to-broker commissions that will
\nslash margins for foreign brokers dealing in Malaysian shares
\nfrom abroad.<\/p>\n
The Kuala Lumpur Stock Exchange fixed the rate following the
\nMalaysian government's announcement last week of a graduated and
\nregressive commission rate that from Monday will cut broking
\ncommissions of local brokers.<\/p>\n
\"It (the new rate) looks quite bad. Foreign brokers are
\nexpected to appeal to the authorities,\" said Yeoh Keat Seng,
\ndirector of research of Crosby Securities research arm in Kuala
\nLumpur.<\/p>\n
Singapore brokers, who have large dealings with local brokers,
\nwill be the hardest hit, although others in Hong Kong, London and
\nNew York, will equally be hurt, analysts here said.<\/p>\n
From Monday, foreign brokers, who used to split commissions
\nequally with Malaysian brokers they have transactions with, will
\nnow get less than their half share on a graduated basis as well.<\/p>\n
While they still share 50:50 for transactions for the first
\n500,000 ringgit (US$200,000), foreign brokers will now only get
\none third while local brokers retain two-thirds of the 0.75
\npercent commission for transactions of between 500,001 and two
\nmillion ringgit.<\/p>\n
Commissions will be slashed down to three-tenths for foreign
\nbrokers, while local brokers retain seven-tenth of the 0.5
\npercent commission earned for transactions of above two million
\nringgit.<\/p>\n
Other charges, including clearing fees, are to be borne by
\nforeign brokers, the exchange said, adding that all broking
\nhouses are to abide by the new rate.<\/p>\n
\"Effectively foreign brokers will only earn between a miserly
\n0.1125 percent and 0.325 percent in commission for sharing deals
\nwith Malaysian brokers,\" said a broker with a foreign broking
\nhouse.<\/p>\n
The graduated scale followed the government's announcement
\nlast week of a regressive commission rate for local brokers as
\npart of sweeping measures to liberalize the Malaysian capital
\nmarket.<\/p>\n
Brokers, who used to charge a flat one percent commission,
\nwill from Monday charge a one percent commission on transactions
\nunder 500,000 ringgit, 0.75 percent on deals of between 500,001
\nringgit and two million ringgit, and 0.5 percent on transacted
\nvolumes over two million ringgit.<\/p>\n
Malaysian officials said the lower fees were aimed at making
\nlocal broking houses more competitive in the region.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/malaysias-sets-two-tier-broking-commissions-1447893297",
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