Morgan Stanley exits from Indonesian market, What is the impact?
Morgan Stanley Sekuritas Indonesia will cease activities as an intermediary for securities traders or its brokerage business after operating in Indonesia starting in 2012.
Banking analysts say that the departure of Morgan Stanley Indonesia will not have much effect on trade transactions and the sale of shares of retail investors because the company’s customers are mostly institutional investors and not many retail investors.
Capital market observer from the University of Indonesia Mr. Budi Frensidy revealed in terms of volume and frequency of transactions, Morgan Stanley brokers are not included in the top 20 brokerage houses in Indonesia. Citing Indonesia Stock Exchange data (IHSG), in April 2021 the value of stock transactions from Morgan Stanley companies reached 6.22 trillion rupiah, it was ranked 19th largest but as for frequency Morgan Stanley is not on the list of top 10 domestic brokers.
The pandemic situation and economic difficulties of countries in the Asian region have also made it harder for risky investment transactions such as stocks and commodities from their intention to invest in the stock market and to remain silent.
Meanwhile, the value of transactions on the U.S. stock market jumped to an all-time high and made the share price expensive. Investment opportunities in Southeast Asian countries such as Indonesia still have opportunities and can follow the U.S. stock market in the future.
Several foreign securities companies continue to operate in Indonesia and one of them managed to gather many retail investors by cutting the cost of selling and buying shares to attract retail investors. Morgan Stanley Indonesia said it would cease brokerage activities in Indonesia after operating in Indonesia starting in 2012. Despite stopping the intermediary activities of securities traders in Indonesia, they through an official statement will still provide access to the Indonesian stock market to its global clients, especially for institutions. Morgan Stanley is one of the most well-known and well-known brokers in the United States.
Indonesia’s domestic equity business opened in 2012 following an announcement by Morgan Stanley CEO James Gorman in November 2011 when he visited Jakarta. He said in a statement that growing the company’s business in Indonesia is an “important strategic priority and commitment” for the U.S bank.
Morgan Stanley said on Thursday that its research coverage would also still be provided from overseas such as Singapore but he added that PT Morgan Stanley Sekuritas Indonesia will continue to serve investment banking clients in the future.