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All brokers are advised to strengthen security by enforcing MFA, stricter password rules and client password resets 

by GLORIA HARRY BEATTY 

MORE than a week after the hacking incident involving Malaysian brokerage companies, the real depth of the damage has yet to be determined. 

It is understood that some of the brokerage companies affected by the April 24 incident are still trying to assess the impact and verify whether the issue has been fully resolved. 

“They are still struggling to put their hands on the exact damage and piece together what actually happened. Is there more than what meets the eye?” said an invest- ment executive who works with brokerages. 

As for the regulators, both the Securities Commission (SC) and Bursa Malaysia Bhd have issued updates on the incident. Apart from stating that it involved a small number of clients, the regulators did not disclose the names of affected brokers or the amount involved in the hacking. 

In a statement on April 27, Bursa Malaysia, after “close consultation” with the SC, clarified that the “losses resulting from the incidents of unauthorised access and trading activities executed on April 24 have been identified and contained”. 

“These incidents, which involved online client trading accounts residing with a small number of brokers, have now been identified and steps have been taken to prevent further occur- rence,” it said. 

It is clear that the financial sector has not been immune to cyberattacks. The breach has highlighted a critical cybersecurity gap in Malaysia’s brokerage industry, posing serious risks to investors and the broader financial system. 

Cybercrime on the Rise 

While the rise of digital technologies has significantly improved modern life, it has also brought about a sharp increase in cybercrime — a trend from which Malaysia is not exempt. 

In 2024, Malaysia witnessed a significant escalation in scam-related activities. The police reported 35,368 scam cases in last year, up 3% from 34,495 from 2023, culminating in financial losses rising 29% to RM1.6 billion, compared to RM1.2 billion in 2023. 

The financial sector has not been immune to these challenges. 

The April 24 cyber attack is the most recent case in point. 

The unauthorised trades reportedly involved Bina Puri Holdings Bhd and its Warrant-B, executed in the afternoon of the same day, as well as Pos Malaysia Bhd and several Hong Kong structured warrants. 

On April 27, Bursa Malaysia issued a directive requiring affected securities and proceeds to be retained for 14 days to facilitate investigations. The exchange emphasised that its trading and clearing systems remain secure and fully operational. 

Malaysia’s stockbroking industry primarily relies on two key providers for direct market access and trading platforms — Excel Force MSC Bhd and N2N Connect Bhd. The latter is the largest Asia-based financial information and trading platform provider. 

In response to the breach, all brokers have been advised to implement enhanced security measures, including mandatory multi-factor authentication (MFA), stricter password policies and client password resets. A forensic audit is underway to determine the root cause of the incident. 

The breach has highlighted a critical cybersecurity gap in Malaysia’s brokerage industry, posing serious risks to investors and the broader financial system. 

According to Murugason, it is important to educate clients on cyber hygiene (Pic courtesy of Murugason R Thangaratnam)

Cyber Security Weakness 

Cybersecurity expert Murugason R Thangaratnam said the incident reveals a larger systemic cybersecurity vulnerability across the sector. 

“A systemic cybersecurity weakness exists in Malaysia’s brokerage industry,” he said, noting the disparities in cyber maturity levels across firms. 

“Major, well-funded brokers generally have stronger defences, (while) smaller or mid-sized brokers often lack dedicated cyber teams and rely on outdated or piecemeal solutions,” he told the Malaysian Reserve (TMR). 

The primary issue is believed to be the absence of a unified cybersecurity standard across the industry. 

While brokers vary in their cyber readiness, many have yet to implement critical security measures like MFA — a system that, despite its effectiveness, is still not universally enforced. “Some only offer SMS-based MFA which is highly vulnerable to SIM-swap attacks,” he said. 

The problem is compounded by outdated infrastructure. Many platforms are built on legacy systems, some of which are 10-15 years old. 

He cautioned that legacy systems are often not equipped with modern encryption, application programming interface (API) security, or threat monitoring. While the SC and Bursa Malaysia have issued cybersecurity guidelines, these are often not enforced aggressively enough to ensure broad compliance. 

He added that cyber audits are frequently treated as “tick-box exercises rather than real readiness tests”. 

“When incidents happen (data leaks, account hacks and DDoS attacks), few brokers disclose publicly unless forced. This creates a false sense of security for investors and leaves industry-wide risks hidden,” he said. 

Urgent Cybersecurity Upgrades

In the wake of the most recent breach, Murugason said it underlined the urgent need for Malaysian brokers to implement a host of cybersecurity upgrades. 

In essence, the upgrades may no longer be optional but necessary to restore public trust and comply with new regulations under the Cyber Security Act 2024 and the Personal Data Protection (Amendment) Act 2024. 

Some of the immediate upgrades brokers must undertake include mandatory MFA for all accounts, real-time activity alerts for suspicious behaviour and a kill switch feature that allows clients to freeze their accounts instantly in the event of a breach. 

Murugason, who is the CEO of Novem CS Sdn Bhd, also advocates for periodic password updates, device whitelisting and the use of behavioural analytics and AI-driven threat detection. On top of that, he highlights the importance of educating clients on cyber hygiene. 

He also said that ongoing cybersecurity education campaigns should be launched to help clients recognise phishing attempts, set strong passwords and use 2FA. 

Stronger Regulatory Action

As the regulator of the Malaysian financial markets, Bursa Malaysia must take more stringent action against brokers with poor cybersecurity practices. 

“One broker’s weakness can ripple across the entire Malaysian financial ecosystem, harming market confidence, investor participation and national financial stability. Retail and institutional investors need to trust that brokers are safe custodians of their funds and personal data. 

“If trust collapses, trading volumes and capital markets activity shrink. If weak brokers face no real consequences, others will cut corners on cybersecurity to save money, creating widespread risk,” he said. 

Global regulatory bodies such as the US Securities and Exchange Commission (SEC), the European Securities and Markets Authority (ESMA) and Japan’s Financial Services Agency (FSA) are heightening their focus on cyber security threats in capital markets. Malaysia must do the same in order to retain global credibility. 

Here, several measures may be in order. They include binding cybersecurity guidelines aligned with global best practices, mandatory external audits and public cybersecurity rankings of brokers. 

Murugason said sending a clear message that non-compliance will not be tolerated to the industry is needed. In addition, he remarked if brokers or parties involved fail to act swiftly after a breach, they should face fines, trading suspensions or even regulatory penalties 

Who Bears the Responsibility?

While investigations are still underway, Murugason believed that from an IT standpoint, the party that should bear responsibility depends on who the contracting parties are. 

“The customer’s engagement and contract are with the broker. Who the broker uses as a service provider is not within the customers’ control or privy. For example, if the customer decides to sue, they will sue the broker.” 

He noted that typically, follow- ing a breach, investigations, and — in some cases, cyber forensic investigations — are carried out to determine the point of entry and how the breach occurred. 

Investigations are usually done internally and not all details will be disclosed to the public. Following that, regulators will then form a strategy plan and implement actions to ensure that such incidents do not repeat in the future. 

Lessons from Japan 

According to recent reports, Japan’s financial sector experienced a significant cybersecurity incident involving unauthorised stock trades.

The FSA reported that, as of April 16, 12 securities firms had identified fraudulent transactions. These unauthorised trades amounted to approximately US$350 million (RM1.5 billion) in sales and US$315 million in purchases. The breaches were attributed to stolen customer information obtained through phishing websites that impersonated legitimate securities companies 

Japan’s experience, especially through cases like the Tokyo Stock Exchange (TSE) system shutdown in 2020 and other cyber incidents involving Japanese financial institutions, offers critical lessons Malaysian brokers must absorb immediately to avoid future disasters. 

One key lesson is that there must be no tolerance for single points of failure. 

On this point, Murugason said Malaysian brokers or parties that led to such incidents, must implement redundant systems (both hardware and software) with automatic failover and regularly simulate failure drills, not just paperwork exercises, to ensure systems recover without human intervention. 

He said “cyber security must be a board-level priority”, highlighting that in Japan, regulators criticised financial institutions for treating cyber security as “an IT department issue” rather than a core business risk. 

Murugason said that there is a pressing need for quick, transparent communication following incidents. 

Malaysian brokers must act now, not react later, or they will face trust erosion, market share loss and regulatory crackdowns after the next big breach, he added. 

The Path Forward 

The breach has underscored the need for continuous improvement and vigilance in Malaysia’s brokerage industry. With increasingly tech-savvy investors and a growing demand for security, brokers or other parties involved cannot afford to ignore the lessons from this incident. 

Murugason said enhanced regulatory frameworks and proactive risk management are essential to safeguard investor interests and maintain market integrity. 

“After a breach, regulatory authorities, institutional clients and the public will demand proof of serious upgrades, not just promises. 

“Failing to move fast and visibly will cause client migration to better-secured platforms, regulatory penalties from SC or Bursa Malaysia and brand damage that is very hard to undo later,” he cautioned.

• This article first appeared in The Malaysian Reserve weekly print edition

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TIME Dotcom Bhd, following its major RM2 billion divestment of data centre assets to funds linked to New York-listed DigitalBridge Group Inc two years ago, is now evolving into a yield-focused stock. 

In a report last week, Maybank Investment Bank Bhd (MaybankIB) observed that the telecommunications company (telco) is increasingly being perceived as a yield play — making it an attractive option for investors during periods of market volatility. 

The bank added that its assumption of a 100% dividend payout translates to an estimated yield of around 5%. 

“Management continues to prioritise the expansion of its fibre footprint amid tapering earnings growth, while adopting an opportunistic stance towards new ventures,” it said in the report which has a ‘Hold’ call on the counter with a 52-week target price of RM5.10. The counter closed at RM5.15 on April 30. 

The report noted that Time Dotcom’s capital expenditure came in below expectations in FY24 due to permit delays related to fibre deployment — likely prompting the distribution of excess cash. 

“With net cash levels still elevated, we believe there remains ample room for further balance sheet optimisation. Under a hypothetical scenario of both elevated capex (RM500 million per year) and dividends (100% payout), we estimate Time Dotcom would still remain in a net cash position for the next three years,” it said. 

It said home fibre broadband has been the main growth driver for Time Dotcom in recent years. 

However, it noted that fibre broadband penetration — currently at about 60% — is showing signs of plateauing, while competitive intensity remains high due to aggressive discounts by mobile players. Despite this, the company has largely held its ground, maintaining its retail offerings year-to-date (YTD). 

Going forward, the report suggested that Time Dotcom could potentially benefit from the deployment of the second 5G network, given its existing back-haul partnership with U Mobile Sdn Bhd. 

On its dividend payout, MaybankIB said it assumes 100% payout going forward, which implies an estimated 5% dividend yield. 

“We believe the current exploratory steps into rooftop solar (similar to Maxis Bhd) and electric vehicle (EV) charging infrastructure are unlikely to be capex-intensive, with management continuing to prioritise the expansion of its fibre footprint,” it said. 

Time Dotcom is primarily entrepreneur-controlled and led, with Afzal Abdul Rahim as its de facto commander-in-chief, while Khazanah Nasional Bhd (Khazanah) holds a passive stake after facilitating the entry of Afzal and his team back in 2008. 

Despite being entrepreneur-controlled, the report noted that there have been no material governance issues. 

In 2022, Time Dotcom sold a significant portion of its data centre business to a US company. 

In April 2023, it completed the transactions related to its strategic partnership for the AIMS Data Centre business through the partial divestment of shares in AIMS Data Centre Holding Sdn Bhd and AIMS Data Centre (Thai- land) Ltd to DB Arrow Pte Ltd, a portfolio company managed by DigitalBridge Group, for RM2.04 billion. 

Pursuant to the disposal, Time Dotcom retains a 30% effective interest remaining in AIMS, despite holding 51% legal ownership of the ordinary shares. — TMR

• This article first appeared in The Malaysian Reserve weekly print edition

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BURSA Malaysia opened marginally lower but turned higher on Monday, buoyed by the positive sentiment of fund inflows by foreign investors throughout last week, analysts said. 

At 9.05 am, the FTSE Bursa Malaysia KLCI (FBM KLCI) gained 1.84 points to 1,544.33 from last Friday’s close of 1,542.49. 

The benchmark index was 0.71 of-a-point easier at 1,541.78 at the opening bell. 

Turnover stood at 123.73 million shares worth RM65.76 million.

Market breadth was positive, with 233 gainers outnumbering 90 decliners, 244 counters were unchanged, 1,778 untraded, and 27 suspended.

Rakuten Trade Sdn Bhd’s equity research vice-president Thong Pak Leng said investors were heartened by the return of foreign buying, which had seen unprecedented outflows since the beginning of 2025.

He said that with the local bourse closing above the 1,540 mark last week, the benchmark index may re-test the 1,600 mark soon. 

“As such, we believe the index will trend within the 1,540-1,555 range today. It is also worthwhile to note that the ringgit has strengthened to RM4.26 per US dollar,” Thong told Bernama. 

Meanwhile, Wall Street ended broadly higher on Friday, buoyed by the better-than-expected non-farm payrolls for April, easing fears of a United States (US) recession.

Unemployment remained at 4.2 per cent while the US 10-year yield edged higher to 4.30 per cent.

Over in Hong Kong, the Hang Seng Index (HSI) ascended above the 22,500 level as sentiment was boosted by optimism over the potential trade talks between China and the US, coupled with strong earnings from technology giants like Xiaomi and Alibaba.

Among heavyweights, Petronas Chemicals climbed 5.0 sen to RM3.47, Sunway, QL Resources, and Telekom added 3.0 sen each to RM4.82, RM4.83, and RM6.92, respectively, YTL Power International rose 2.0 sen to RM3.45, and YTL Corporation increased 1.0 sen to RM1.94. 

In active trade, West River grew half-a-sen to 39.5 sen, Sentoria was flat at half-a-sen, Nationgate rose 5.0 sen to RM1.57, OCR was half-a-sen lower at 3.5 sen, and Jiankun added half-a-sen to 3.0 sen. 

On the index board, the FBM Emas Index was 28.80 points firmer at 11,518.18, the FBMT 100 Index appreciated 25.02 points to 11,282.26, and the FBM Emas Shariah Index strengthened 33.43 points to 11,423.78.

The FBM 70 Index jumped 82.25 points to 16,356.79, and the FBM ACE Index gained  20.40 points to 4,669.60.

Across sectors, the Financial Services Index accumulated 18.86 points to 18,259.81, the Industrial Products and Services Index rose 0.83 of-a-point to 153.12, the Energy Index put on 1.35 points to 696.32, and the Plantation Index grew 12.73 points to 7,296.50. — BERNAMA

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BURSA Malaysia is expected to trend higher next week, supported by continued improvements in the global economic landscape and the return of foreign buying to the local bourse.

Rakuten Trade Sdn Bhd equity research vice-president Thong Pak Leng said the renewed foreign interest, with overseas investors turning net buyers on Bursa Malaysia, points to the likelihood of further inflows.

“Malaysian equities continue to stand out on valuation grounds, which could increasingly capture the attention of global investors,” he told Bernama.

According to reports, China yesterday signalled its willingness to re-engage in trade discussions with the US. 

Meanwhile, UOB Kay Hian Wealth Advisors Sdn Bhd head of investment research Mohd Sedek Jantan said the overall performance of the FTSE Bursa Malaysia KLCI (FBM KLCI) this week exceeded earlier expectations with the index extending its rally to close at 1,542.49 on Friday.

“This stronger-than-expected performance suggests sustained investor confidence and underlying market resilience even amid global uncertainties,” he told Bernama.

The nonfarm payrolls (NFP) data for April would be pivotal in determining whether the US economy is facing a short-term, tariff-induced slowdown or entering a more prolonged downturn, he said prior to the data’s release.

“The markets are closely watching these indicators for signals on the underlying health of the US economy and potential implications for monetary policy, especially amid ongoing trade tensions,” he said.

According to NFP data, the number of jobs rose by 177,000 — more than the 138,000 expected by economists — showing that the US labour market remained resilient.

On a Friday-to-Friday basis, the key index gained 33.29 points to 1,542.49 from 1,509.20 a week earlier.

The FBM Emas Index gained 269.54 points to 11,489.38, the FBMT 100 Index advanced 267.32 points to 11,257.24, the FBM Emas Shariah Index strengthened by 306.09 points to 11,390.35, the FBM 70 Index jumped 483.44 points to 16,274.54, and the FBM ACE Index rose 25.63 points to 4,649.20.

By sector, the Industrial Products and Services Index added 3.56 points to 152.29, the Energy Index expanded 20.29 points to 694.97, the Financial Services Index went up 249.76 points to 18,240.95, the Plantation Index climbed 58.85 points to 7,283.77, and the Healthcare Index improved 73.27 points to 1,942.42.

Turnover shrank to 10.96 billion units valued at RM8.26 billion from 14.14 billion units valued at RM9.03 billion in the preceding week.

The Main Market volume dropped to 5.61 billion units worth RM7.44 billion compared with 6.62 billion units worth RM7.90 billion previously.

Warrants turnover decreased to 3.99 billion units worth RM399.64 million from 5.77 billion units worth RM571.23 million in the prior week.

The ACE Market volume declined to 1.35 billion units valued at RM411.63 million from 1.73 billion units valued at RM547.26 million previously. — BERNAMA

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KUALA LUMPUR — Bursa Malaysia recouped earlier losses with the key index closing at its intraday high on Friday, in tandem with the positive regional market performance and late buying in telecommunications, construction, property, and data centre-related stocks.

At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) gained 2.27 points, or 0.15 per cent, to 1,542.49 from Wednesday’s close of 1,540.22. 

The exchange was closed on Thursday for the Labour Day holiday.

The market bellwether opened 2.80 points lower at 1,537.42 and subsequently slid to a low of 1,532.23 in early trade before crawling back up to its intraday high at closing.

Market breadth was positive with 744 gainers thumping 311 decliners, while 449 counters were unchanged, 840 untraded, and 20 suspended.

Turnover improved to 2.73 billion units valued at RM2.46 billion against Wednesday’s 2.56 billion units valued at RM2.25 billion.

Rakuten Trade Sdn Bhd equity research vice-president Thong Pak Leng said the key regional indices edged higher after China signalled it is evaluating potential trade talks with the US.

“This development helped lift market sentiment and attracted foreign funds into the region.

“China’s Commerce Ministry stated that the US had recently expressed interest in resuming discussions and China is currently assessing the proposal,” he told Bernama.

On the domestic front, Thong remains optimistic about the easing trade tensions between the world’s two largest economies, although he remains cautious pending the outcome of ongoing discussions.

Among the heavyweights, Sunway Bhd added 24 sen to RM4.79, IHH Healthcare rose 13 sen to RM7.05, Gamuda garnered 16 sen to RM4.40, IOI Corp climbed six sen to RM3.72, and CelcomDigi perked up three sen to RM3.85.

As for the active stocks, market debutant Reach Ten and Tanco climbed two sen each to 54 sen and 88 sen respectively, Nationgate rose 16 sen to RM1.52, Jaks Resources improved 2.5 sen to 12 sen, and Avangaad was flat at 27.5 sen.

On the index board, the FBM Emas Index garnered 81.60 points to 11,489.38, the FBMT 100 Index increased 72.80 points to 11,257.24, the FBM Emas Shariah Index jumped 116.06 points to 11,390.35, the FBM 70 Index soared 329.17 points to 16,274.54, and the FBM ACE Index climbed 20.54 points to 4,649.20.

Sector-wise, the Financial Services Index rose 6.34 points to 18,240.95, the Industrial Products and Services Index firmed 0.81 of-a-point to 152.29, the Energy Index gained 6.83 points to 694.97, and the Plantation Index put on 26.35 points to 7,283.77.

The Main Market volume expanded to 1.70 billion units worth RM2.04 billion against Wednesday’s 1.33 billion units worth RM2.04 billion.

Warrants turnover tumbled to 689.48 billion units valued at RM75.64 million from 814.34 million units valued at RM91.56 million previously. 

The ACE Market volume slipped to 341.65 million units worth RM108.73 million compared to 417.40 million units worth RM113.82 million on Wednesday.

Consumer products and services counters accounted for 195.05 million shares traded on the Main Market, industrial products and services (272.02 million), construction (190.88 million), technology (253.14 million), SPAC (nil), financial services (483.31 million), property (228.45 million), plantation (25.45 million), REITs (13.38 million), closed/fund (43,000), energy (99.80 million), healthcare (67.91 million), telecommunications and media (172.82 million), transportation and logistics (47.52 million), utilities (60.68 million), and business trusts (48,100). — BERNAMA

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CAPITAL A Bhd is exploring a potential dual listing on the Hong Kong Stock Exchange to expand its investor reach and fuel growth across its digital and aviation services. 

The move follows engagement with HKEX and reflects the group’s strategy to attract investors, especially from Mainland China, who are increasingly interested in Asean-based companies. 

Its CEO Tony Fernandes in a press statement today said the listing would amplify Capital A’s global story, particularly for non-aviation units like Asia Digital Engineering, Teleport, and AirAsia MOVE. 

An international investment bank is set to be appointed to advise on the structure and timeline, pending regulatory and internal approvals.

The announcement comes as Capital A makes strong progress on its PN17 regularisation plan, targeting completion by June 2025. 

Milestones include the near-finalisation of a RM1 billion AirAsia X private placement, regulatory clearance from Thailand’s SEC, lender approvals, and plans to dispose of its aviation businesses to AAX. 

Financial audits for FY2024 have been completed with robust Q1 2025 results. 

While the latest audit includes a going concern note, the company attributes it to procedural timing rather than operational weakness. 

Looking ahead, Capital A plans to reactivate its full aircraft fleet by July and focus on becoming a leaner, more globally competitive group. –TMR

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