Bapepam plans to attract more local investors

JAKARTA (JP): The Capital Market Supervisory Agency (Bapepam) will work to make the country's stock exchanges more attractive to local investors, the agency's chief said.

Bacelius Ruru told reporters here on Monday that domestic investors need to improve their role in daily trading to stabilize the capital market because 70 percent of daily transactions are now dominated by foreign investors.

"Our long-term policy is to encourage increased participation of local investors because the stock market will have a stronger foundation when they dominate the market," he said during a press conference marking the 17th anniversary of the country's capital market reactivation.

He explained that Bapepam, in its attempts to attract local investors, will take several steps, including encouraging the establishment of open-end investment companies managing mutual funds.

Bapepam has also proposed that the government increase the ceiling of portfolio investments made by pension funds from the current 10 percent of their total funds, he said.

Ruru said Bapepam will also increase its supervision of the activities of share issuers to protect the interests of the investing public.

Bapepam, for example, will always request that share issuers meet the lofty promises mentioned in their prospectuses, he said.

He claimed Bapepam will also improve enforcement of regulations on the capital market. (yns)