I REFER to the March 5 Hock Lock Siew column about DBS rationalising its equity trading offering ("Will DBS be third time lucky in transforming its retail equities strategy?")

The column is a one-sided apology for remisiers. What outpouring of public support for remisiers has there been except from remisiers? Since no one represents the elimination of remisiers, I feel the need to contribute a rebuttal.

As Jeff Bezos of Amazon famously observed: "Your margin is my opportunity". Amazon has relentlessly gone after businesses with unnecessary and oppressive expenses that are being passed on to the ultimate consumer. I can think of no better candidate than stock trading in Singapore, where we continue to have costs calculated in percentages on transactions, even though the actual costs are the same for trading one share or 100,000.

There is a lot of moaning about the moribund state of the local market. Might I suggest that this is a consequence of allowing casinos in Singapore. The folk who view the stock market as a place to gamble (with their remisiers providing credit) have moved to a cheaper and faster place to gamble.

What is left are those of us who use the stock market as a place to invest - something I have been doing for more than 15 years. I don't need a remisier. What I do need is fast, reliable and cheap execution, preferably without having to go through a human being.

Numerous studies have shown that expenses are the great destroyers of gains when investing. The costs in Singapore compare very poorly with other markets and make investing here unattractive. The artificial separation of trading between lots and units also raises costs. When firms offer dividend reinvestment programmes, one must think carefully before participating if the result is an odd lot. Trading costs for odd lots can easily exceed the value of the shares to be sold.

Like buggy whip makers and blacksmiths making horseshoes, it is time for remisiers to admit that the business model on which they have made their living is dead. I applaud DBS' move to make trading seamless (and, hopefully, cheaper).

P.S. The current edition of Microsoft Word does not even have the word "remisier" in its dictionary - a pretty good clue that the word and profession are archaic.

Waleed A. Hanafi

Managing Director

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