Major IPOs herald exciting times ahead

Bursa Malaysia is abuzz with excitement. Home to the world's second- and third-largest initial public offerings (IPOs) this year, Malaysia has become the world's top IPO destination.

Next only to American social networking service corporation Facebook, in terms of capital generated through the offering, the Felda Global Ventures IPO in June raised US$3.3 billion.

The Malaysian plantation operator even had to sell additional shares to accommodate excess demand. The local bourse again took the spotlight with the IPO last month of leading hospital operator IHH Healthcare, the world's third-largest offering this year.

The stock market's strong showing did not come as a surprise. As one of the 12 NKEAs under the ETP, the financial services sector has been undergoing structural changes over the past two years.

The sector's role in the economy has been growing across the past decade. From an average gross domestic product (GDP) share of 9.9 per cent between 2000 and 2005, the financial sector's GDP contribution climbed to 10.9 per cent in the 2006-2009 period and to 11.6 per cent in 2010.

The ETP aims to further strengthen the sector so it can serve businesses and consumers when Malaysia achieves a high-income status in 2020.

The financial services NKEA identified four thrusts: strengthening core financial services, serving the needs of the high-income population, developing new growth sectors and adopting an offensive stance.