Malaysia tests "first-of-its-kind" sec lending blockchain PoC
07 November 2019 Kuala Lumpur
Image: Shutterstock
Malaysia鈥檚 stock exchange has completed a proof-of-concept (PoC) for its blockchain-powered securities lending solution, which aims to increase the efficiency, speed and capacity of its lending pool, as part of a radical overhaul to the country鈥檚 lending market.
Bursa Malaysia鈥檚 PoC was conducted in collaboration with Citigroup鈥檚 Malaysian subsidiary, Malaysian investment bank Affin Hwang Investment Bank, Singapore-based CGS-CIMB Securities, Malaysian pension fund Kumpulan Wang Persaraan, and brokerage firm Malacca Securities.
The technology partner that executed and tested the PoC was Hong Kong-based Forms Syntron Information, a subsidiary of Shenzhen Forms Syntron Information.
Bursa Malaysia described the project as the first of its kind for the securities lending markets of the Association of Southeast Asian Nations region.
In a statement, the exchange said it has completed a successful test of the private-permissioned blockchain-driven 鈥楽BL Lending Pool鈥�, which it says will enhance market discovery, create increased efficiencies as well as build transparency and trust.
The PoC has secure, shared ledgers and smart contracts which enable instant and automated update of asset status, the statement continued.
鈥淚nformation stored in the ledger, like records of trade negotiations and order confirmations, are immutable, auditable and traceable. It avoids the need for manual reconciliation, which may introduce errors due to disparate methods of trade negotiation and order confirmation recording,鈥� Bursa Malaysia explained.
According to Bursa Malaysia, the PoC represents the beginning of 鈥渁 longer-term holistic roadmap that leverages emerging technology to address challenges in the securities lending market鈥�.
The exchange stated that its SBL Lending Pool is the "fundamental building block of this roadmap,鈥� which is targetting inefficiencies in execution, collateral management and corporate action management.
Bursa Malaysia said its ultimate aim is to build a 鈥渇uture-ready end-to-end, technology-driven solution鈥� for the country鈥檚 securities lending market.
Commenting on the recent blockchain tests, Bursa Malaysia CEO, Datuk Muhamad Umar Swift, said: 鈥淓vidence shows that a vibrant securities lending market is one of the key characteristics of a developed capital market.
鈥淎s such, it is imperative that we tackle the operational challenges of today with a technologically driven solution that is flexible and scalable into the future. The PoC also brings in new knowledge, insights and practical experience in harnessing digital innovation - a core requirement of any exchange that aims to be a leader in its space in the future.鈥�
Bursa Malaysia鈥檚 PoC was conducted in collaboration with Citigroup鈥檚 Malaysian subsidiary, Malaysian investment bank Affin Hwang Investment Bank, Singapore-based CGS-CIMB Securities, Malaysian pension fund Kumpulan Wang Persaraan, and brokerage firm Malacca Securities.
The technology partner that executed and tested the PoC was Hong Kong-based Forms Syntron Information, a subsidiary of Shenzhen Forms Syntron Information.
Bursa Malaysia described the project as the first of its kind for the securities lending markets of the Association of Southeast Asian Nations region.
In a statement, the exchange said it has completed a successful test of the private-permissioned blockchain-driven 鈥楽BL Lending Pool鈥�, which it says will enhance market discovery, create increased efficiencies as well as build transparency and trust.
The PoC has secure, shared ledgers and smart contracts which enable instant and automated update of asset status, the statement continued.
鈥淚nformation stored in the ledger, like records of trade negotiations and order confirmations, are immutable, auditable and traceable. It avoids the need for manual reconciliation, which may introduce errors due to disparate methods of trade negotiation and order confirmation recording,鈥� Bursa Malaysia explained.
According to Bursa Malaysia, the PoC represents the beginning of 鈥渁 longer-term holistic roadmap that leverages emerging technology to address challenges in the securities lending market鈥�.
The exchange stated that its SBL Lending Pool is the "fundamental building block of this roadmap,鈥� which is targetting inefficiencies in execution, collateral management and corporate action management.
Bursa Malaysia said its ultimate aim is to build a 鈥渇uture-ready end-to-end, technology-driven solution鈥� for the country鈥檚 securities lending market.
Commenting on the recent blockchain tests, Bursa Malaysia CEO, Datuk Muhamad Umar Swift, said: 鈥淓vidence shows that a vibrant securities lending market is one of the key characteristics of a developed capital market.
鈥淎s such, it is imperative that we tackle the operational challenges of today with a technologically driven solution that is flexible and scalable into the future. The PoC also brings in new knowledge, insights and practical experience in harnessing digital innovation - a core requirement of any exchange that aims to be a leader in its space in the future.鈥�
NO FEE, NO RISK
100% ON RETURNS If you invest in only one securities finance news source this year, make sure it is your free subscription to Securities 麻豆影视传媒 Times
100% ON RETURNS If you invest in only one securities finance news source this year, make sure it is your free subscription to Securities 麻豆影视传媒 Times
