Announcement for June 25, 2019 at 08:50 PM GMT
THIS IS AN ANNOUNCEMENT FOR THE MSCI GLOBAL STANDARD INDEXES
RESULTS OF THE MSCI 2019 MARKET CLASSIFICATION REVIEW
London - June 25, 2019 - MSCI Inc. (NYSE:MSCI), a leading provider of critical
decision support tools and services for the global investment community,
announces today that it will reclassify the MSCI Kuwait Index to Emerging
Markets status, subject to omnibus account structures and same National Investor
Number (NIN) cross trades being made available for international institutional
investors before the end of November 2019. MSCI will communicate its final
decision by December 31, 2019.
"Kuwait's Market Development Project has set the path for the seamless
implementation of numerous regulatory and operational enhancements in the
Kuwaiti equity market. These enhancements have significantly increased the
accessibility level of the Kuwaiti equity market for international institutional
investors and resulted in broad positive feedback from these investors on our
reclassification proposal," said Sebastien Lieblich, Global Head of Equity
Solutions and Chairman of the MSCI Equity Index Committee.
Mr. Lieblich added, "During the consultation, international institutional
investors highlighted the criticality of omnibus account structures and same NIN
cross trade capabilities to avoid frictions in their investment process. We
welcome the Capital Market Authority's public commitment to deliver these market
features by November 2019. We will closely monitor their implementation before
making the final decision."
On June 12, 2019 the Capital Market Authority publicly announced that omnibus
structures, as well as same NIN cross trading will be made available to
international institutional investors no later than November 2019. Currently,
only local licensed entities are allowed to trade using omnibus accounts and
same NIN trading is available for only certain exempt 'non-discretionary' local
accounts. Assuming the above-mentioned market features are delivered by November
2019, MSCI would include the MSCI Kuwait Index in the MSCI Emerging Markets
Index in one step coinciding with the May 2020 Semi-Annual Index Review. This
would lead to an inclusion of nine stocks in the MSCI Emerging Market Index
having a pro forma index weight of approximately 0.5%. The constituent list of
the pro forma MSCI Kuwait Index as of April 17, 2019, based on the MSCI Emerging
Markets Index thresholds, has been made available on
https://www.msci.com/market-classification.
The implementation of Kuwait's Market Development Project, started in 2017, has
brought numerous enhancements to the infrastructure of the market that have
significantly opened the domestic equity market to international institutional
investors. Among these enhancements were the removal of foreign ownership
restrictions on listed banks and simplification of requirements for investor
registration. In addition, the settlement cycle in the Kuwaiti equity market
moved to T+3 for both local and foreign investors, a new delivery versus payment
(DvP) settlement provision was introduced and a proper failed trade management
process was initiated. The Project is expected to continue with the planned
introduction of a central clearing counterparty and availability of stock swaps,
stock lending and short selling facilities, among other improvements. These
enhancements have now been reflected in the MSCI 2019 Global Market
Accessibility Review report available at
https://www.msci.com/market-classification.
MSCI also announces today the launch of a consultation to potentially reclassify
the MSCI Iceland Index from Standalone Markets to Frontier Markets status. MSCI
welcomes feedback from market participants on this proposal prior to October 31,
2019 and will announce the results of this consultation on or before November
29, 2019.
Finally, MSCI is announcing today that, if the MSCI Peru Index falls short of
the required three constituents for the Emerging Markets, it will immediately
launch a consultation to potentially reclassify the MSCI Peru Index from
Emerging Markets status to Frontier Markets status. The MSCI Peru Index
currently includes the minimum of three constituents.
Media Inquiries:
PR@msci.com
Sam Wang +1 212 804 5244
Melanie Blanco +1 212 981 1049
Laura Hudson +44 20 7336 9653
MSCI Global Client Service:
EMEA Client Service + 44 20 7618.2222
Americas Client Service +1 888 588 4567 (toll free)
Asia Pacific Client Service + 852 2844 9333
THIS IS AN ANNOUNCEMENT FOR THE MSCI GLOBAL STANDARD INDEXES
End of announcement.
Further announcements may occur as needed.
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