SE Asia exchanges to roll out benchmark stock index

KUALA LUMPUR, Sept 20 (Reuters) - Five Southeast Asian stock exchanges
will launch the FTSE/ASEAN 40 Index <.FTASEAN40>. on Wednesday to track
stocks in the region and lure foreign portfolio investors.

The index, produced in partnership with global index provider FTSE
Group, comprised 40 top stocks from Indonesia, Malaysia, the
Philippines, Singapore and Thailand, Malaysian officials said.

"A tradeable ASEAN Index would contribute towards branding ASEAN as an
attractive asset class for global investors," Malaysia's finance
ministry said in a statement.

"It's a showcase of the best of the best from ASEAN," Ridzal Sheriff, a
senior official at Malaysia's stock exchange, Bursa Malaysia , told
reporters.

The index, which marked the first joint effort by the five exchanges
under the ASEAN umbrella, is part of the grouping's goal to create an
interlinked stock market by 2010.

The 10-member Association of South East Asian Nations (ASEAN) also
includes Brunei, Cambodia, Laos, Myanmar and Vietnam.

Finance ministers from eight ASEAN countries, meeting in London for a
joint investment seminar, were expected to launch the index on
Wednesday. The finance ministers of Laos and Myanmar were not expected
to attend.

Individually, the capital markets of ASEAN are small. Singapore is
ASEAN's largest stock exchange in terms of market capitalisation, but
it is less than 10 percent the size of Tokyo, ASEAN officials said.

But a combined ASEAN exchange would be comparable in size with the
markets of China and India, they said.

The index, whose base currency is the dollar, has 14 Malaysian, 12
Singaporean, 7 Indonesian, 6 Thai and 1 Philippine stock.

But Singapore firms have the heaviest weighting in the index,
accounting for 49 percent, with banks such as DBS Group Holdings , UOB
Ltd. , OCBC and telecoms firm Singapore Telecommunications emerging as
the top four stocks.

Malaysia is second with a weighting of 25 percent. Top names include
Public Bank Bhd and Malayan Banking Bhd .

Bursa Malaysia's Ridzal said eligible stocks must have a freefloat of a
minimum of 15 percent, and would be reviewed every March. The index was
expected to spur related products such as exchange-traded funds, index
futures and index warrants, he added.


09/20/05 06:49 ET


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