The Stock Exchange of Thailand's (SET) board of governors will be revamped within 120 days after the amended Securities and Exchange Act becomes effective, says the Securities and Exchange Commission (SEC).
The Act was endorsed by the National Legislative Assembly on Feb 8 and is expected to take effect soon.
The SET will be affected the most as the amended Act impacts the bourse's capital market domination, said SEC secretary-general Rapee Sucharitakul.
The Act changes capital market mechanisms and improves fairness among all stakeholders and market participants, said Mr Rapee.
There are 11 members in the SET's board of governors, with five appointed by the SEC and another five elected by brokerage firms who are members of the SET. The SET president is appointed by the SET's board of governors.
Each member has a two-year tenure on the board of governors.
SEC assistant secretary-general Sakkarin Ruamrungsri said the new selection process will reduce the number of members elected by brokerage firms to four and increase the SEC's appointments to six members.
Each member will have a three-year tenure and five members will be required to draw lots to relinquish their positions upon becoming members in the SET's board of governors for one-and-a-half years, reported efinancethai.com.
The amended Act also stipulates that a maximum of two qualified non-Thai nationals could become members.
The new selection process is aimed at enhancing transparency for management of the SET, which is an important structure for Thailand's capital market development, said Mr Sakkarin.
Existing members will have to relinquish their positions once the new governors are selected, he said.
Established in 1975, the SET has become a market with the top trading liquidity in Southeast Asia for the past five years. The bourse's current market capitalisation is worth around 17 trillion baht, with average daily turnover valued around 40-50 billion.
SET president Pakorn Peetathawatchai said the SET must develop its business model to suit changes in the capital market.
The SET can transform securities trading through digital depository receipt assets and trade them on the bourse under the Act, said Mr Pakorn.
Pattera Dilokrungthirapop, chairperson of the Association of Securities Companies Thailand (Asco), said Asco will not be greatly impacted by the reduction in the number of members on the SET's board of governors because the association already reduced the quota selected by brokerage firms to four from five several years ago.
