Kuala bear? Not the Malaysian market's Azlan

"It's been a long, slow climb back for us," concedesAzlan Hashim, head of the Kuala Lumpur Stock Exchange. But now that Malaysia's bourse has at least partly recovered from the Asian financial crisis -- it's one of the few exchanges in Asia or anywhere else to have risen this year -- the dapper, 43-year-old exPeat Marwick partner is casting about for expansion opportunities.

Azlan, who's fond of Armani and Ermenegildo Zegna suits, says he wants to "regionalize" the KLSE by persuading blue-chip Asian corporations to list in Malaysia as well as in their home countries; he's also trying to lure smaller companies from Singapore, China and even India.

Over the past four years, Azlan has vastly improved the exchange's once-suspect system of governance, and he recently won board permission to further modernize the KLSE by taking it public by mid-2003. The exchange also wants to allow investors to trade shares in smaller lots to boost liquidity and make them more affordable to retail investors. Most companies listed on the KLSE trade their shares in 1,000-shares lots.

Critics snipe that Azlan is simply out to poach small companies stuck in the queue to list in Singapore or Hong Kong (see Regulation). He denies it: "All we want to do is to enhance the depth and breadth of our market."

Turning the KLSE into a bustling regional stock market won't be easy. The exchange may be mending, but it's not yet thriving: Daily turnover of 200 million shares is one fifth what it was at the apex of the 1993 bull market, and the total market cap of its 900 listed companies -- $170 billion -- is less than half what it was at the peak. And the first foreign listing won't debut before the end of next year, Azlan acknowledges.

The dream of a being a regional player is not an altogether new one for the KLSE. Until 1990 about 200 Singaporean and a like number of Malaysian companies were listed on both countries' stock markets, but a legal tussle over the Malaysian companies' right to offer shares in Singapore ended the practice.

Azlan isn't worried about similar problems this time. "Our aim," he says, "is to make Kuala Lumpur the venue of choice for emerging companies in the region."