Comparison Between Direct CDS and Nominees CDS Account

When opening a trading account with a Stock Broker (Participating Organization or Investment Banks) a CDS account will be opened at the same time. Normally, stock brokers can offer Direct CDS or Nominee CDS Account.
CDS stand for “Central Depository System” and it maintain by Bursa Malaysia Depository Sdn Bhd. Previously it was known as Malaysian Central Depository (“MCD”).
Each CDS account have its own advantage and disadvantage. The table below highlighted the different between the two.

	CDS Account
	Direct	Nominee
Account Name	Under shareholder name (eg Mr M)	Under broker name ( eg HLG Nominee Tempatan for Mr M)
IPO application	Eligible	Not eligible
Paperwork on corporate exercise	Handle by shareholder	Handle by stock broker (upon instruction). Broker may impose fees.
Dividend	Send to shareholder	Credited to trust account with stock broker
Attending AGM	Eligible	Not Eligible (Possible but have to get stock broker to appoint as proxy)
Annual Report	Mail to shareholder	Have to request from broker
Share transfer	To own or relative account	Only to own account

By looking at the table above, it is clear that Direct CDS account have more advantage when compare to Nominee CDS account. The only advantage of Nominee CDS account is shareholder do not need to worry about paperwork on corporate exercise.