Thailand Securities Depository to offer online IPO service

Source: Thailand Securities Depository

Thailand Securities Depository Co. Ltd. (TSD) prepares to offer the new e-IPO service.

This new service will enable investors to subscribe in shares conveniently through the Internet, enlarging the market's investor base and reducing securities companies' costs. Later, the TSD will add securities borrowing and lending, and corporate bond repurchasing services.

TSD announced that it will provide an e-IPO service, or the offering of share subscriptions at initial public offerings (IPOs) though its Internet-connected system. The e-IPO will make IPO share offerings easier for both the securities companies and investors. The system helps reduce the costs of the securities companies, and enlarges the market's investor base, as it provides a more convenient means for subscribing in IPO shares via the Internet.

Presently, securities companies develop their own systems for share subscription, and the different systems adopted that may create discrepancies in the database. Furthermore, investors have to physically go to the subscribing agent's office, prepare documents, and wait in queue to subscribe for shares and pay for their subscriptions. The existing system is both inconvenient and expensive.

TSD's e-IPO system will be a web-based application that will be able to pool data from different sources and enable quick monitoring of the subscription results. Investors can access the e-IPO system via the Internet from any location, thus saving them both time and money.

In addition to the convenience the e-IPO would bring, the system will reduce errors that may occur during the share subscription process, as the new system manages each subscription, crosschecks and ensure compliance with conditions of each given IPO as well as the specifications stated by each investor.

The TSD-developed e-IPO system will be able to serve underwriters regardless of whether there is an early share allocation before the IPO or not. Investors can log onto the Internet, register with the TSD, and get their own user name and password to access the system. Investors may find out the results of the share subscription through the TSD Call Center or have these results mailed directly to them.

In addition to the new e-IPO service, the TSD will also be developing its work systems so that they can more efficiently operate as a center for securities borrowing and lending (SBL) as well as collateral management. Furthermore, the TSD will be a center for corporate bond repurchases (repo), thus helping to develop the Thai bond market.

The TSD will proceed with these developments with advice from the Korea Securities Depository, which has accumulated a great deal of experience and expertise in these operations. The TSD expects its repo and SBL services to be available by January 2006 and April 2006, respectively.

The expansion of TSD's services will help achieve greater efficiency in the industry's SBL and repo transactions as well as assist parties in risk management during the clearing and settlement processes.

The TSD will now seek approval for these development plans from the Securities and Exchange Commission (SEC).

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