Revamped Benchmark Index To See Great Liquidity
Bursa Malaysia said it will press publicly traded companies to sell more shares to stay in a revamped benchmark stock index, a move aimed at making the equities easier to buy and sell. In an interview with Bloomberg, Bursa’s CEO Yusli Yusoff said that the move will “bring a sense of competition” and that a lot of companies would want to be in that benchmark.” The bourse is replacing the 100-share KLCI with a new 30-share FTSE Bursa Malaysia KLCI on July 6. Companies in the new index will be required to have at least 15% of their shares publicly available for trading, a level that may increase every six months. PM Najib had yesterday announced plans to sell more of government’s holdings in some of the nation’s biggest companies to lure more foreign investment to Malaysia following a review of the FIC.

Tenaga Nasional Delays Prai Plant
Tenaga Nasional is deferring a plan to build a 220-megawatts power plant in Prai, Penang, due to lower-than-expected electricity demand. The company had planned for the plant in Prai to meet projected demand for electricity in the north. However, due to the slow-down in demand, it will wait until 2014 and 2015 when the other plants are completed. Its management disclosed that there were no plans to defer the building of any other plants. The plant would have cost Tenaga between RM400m and RM500m.

BCH To Corporatise ‘Bad Bank’ Division
Bumiputra-Commerce Holdings (BCH) plans to corporatise an internal “bad bank” division this year, which may be expanded later to house the group’s legacy bad loans from Thailand. The company was quoted as saying at Invest Malaysia 2009, that it was looking at various strategies to manage its bad loans asset, which could include bringing in strategic shareholders as partners of the bad bank. The assets held by its internal bad bank division are currently worth around RM1b in book value, significantly written down from the legally claimable value of some RM11b. The amount of bad loans that can be potentially transferred from CIMB Thai Bank is not yet clear. CIMB Niaga, however, probably won’t be included in the move since the Indonesian lender had already sold most of its legacy bad loans to the Indonesian Bank Restructuring Agency.

Johor Weighs MRT Link Option
Johor is studying plans to connect Iskandar Malaysia to Singapore via mass rapid transit (MRT) system over the next 5 years, now that chances for a third bridge across the causeway get slimmer. MB Datuk Abdul Ghani Othman said that it is already working on the possibility of interfacing Singapore’s MRT with Iskandar Malaysia’s own MRT system. He added that Singaporean counterparts had suggested extending its new Thompson Line, which is now under construction, to Johor Baru. However that line won’t be ready until 2018.