PETALING JAYA: The Securities Commission Malaysia (SC) has reminded fund management and unit trust management companies of their obligations to act in the best interest of investors at all times, and ensure fair treatment of their clients in times of the unprecedented and volatile market conditions arising from the Covid-19 pandemic.
In a circular, the regulator emphasised that good governance, proper conduct and continuous compliance to capital market regulations are imperative to the functioning of capital market intermediaries.
This applies especially to investment management professionals licensed by the SC.
“Under current market conditions, the SC, as the capital market regulator, must and will ensure that the markets operate in a fair and orderly manner, and that investor protection is upheld,” said its chairman, Datuk Syed Zaid Albar in a press statement.
The regulator stated capital market intermediaries need to closely monitor the dealing and trading of funds under management, and ensure that their clients are informed of the potential risks in funds that they intend to invest in.
It also highlighted that market participants must properly manage the funds’ liquidity, especially in mitigating potential mismatches between liquidity of the funds’ underlying assets and the redemption terms.
The SC pointed out that timely communications to both the regulator and investors is critical in the current market environment.
“As such, capital market intermediaries are required to promptly alert the SC on any material issues or anticipated adverse circumstances relating to the funds under their management.” it said.
Furthermore, with the increased use of online platforms for transactions and certain operations, the regulator reminded intermediaries to heighten their cyber risk management protocols and have in place robust business continuity measures to mitigate the impacts of potential disruptions in these times of crisis.
source https://www.thesundaily.my/business/sc-reminds-unit-trusts-and-fund-managers-to-prirotise-clients-best-interests-YH2238436
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