The Flow of a Bond Issuance - Part 2 - Primary Level (continuation)

Another important infrastructure that I forgot to add in the last posting is the BIDS system. As the Malaysian bond market is an Over-the-Counter (OTC) market, the authorities decided to create a reporting system for the market.

Bond Information and Dissemination System (“BIDS”)


•This is the system under BNM that captures all trading data on the Malaysian bond market. The BIDS system was established in 1997, to enhance the transparency of secondary-market information. It is a computerised and centralised database on ringgit-denominated debt securities, providing information on the terms of issues, prices of trades, details of trades done, including transactions on repo activities, and relevant news on the various debt and sukuk papers issued by both the Government and the corporate sector. 

• Under the Rules on BIDS (effective October 2001), all the members of FAST and RENTAS are required to provide all the relevant trade information after a transaction has been executed, whether the parties are from the buy or sell side. They are obliged to report via BIDS the details of the trade done, within 10 minutes of execution. Rating agencies, on the other hand, are required to update the issuers' ratings. Selected information from BIDS is shared on an almost real-time basis with major newswire services like Reuters and Bloomberg. Members of BIDS must be guided by the principle of integrity, to ensure proper input of information as well as accuracy and timeliness. The Rules on BIDS are very explicit, in that responsibility lies solely with the members. BNM is not liable for any inaccuracies. 

•Since March 2008, the responsibility has been handed over to Bursa Malaysia.