The Singapore Exchange is reviewing the need for quarterly reporting and looking closely at dual-class shares, in sweeping moves aimed at refreshing and improving the quality of the stock market here.
It is also mulling over whether to allocate a larger proportion of a mainboard listing's shares to retail investors, up from the previous 5 per cent level proposed, said SGX chief executive Loh Boon Chye.
Speaking at the first SGX Equities dialogue yesterday, Mr Loh said the exchange is constantly looking for ways to improve the market and giving retail investors more access to listed companies. Apart from setting up a team to study the need for continued quarterly reporting, first-time short-sellers will no longer be automatically penalised if they fail to deliver their stocks in time, he added.
The SGX will also give more time for new rules to kick in. It will start collateralised trading - where investors need to put up some capital when they buy a stock - only in 2018 instead of this year. "Given the many structural changes we have implemented to date, we remain conscious about striking a balance as too many changes in a relatively short time can be detrimental or counterproductive," said Mr Loh
He also said that the SGX has submitted matters related to dual-class shares to the Listings Advisory Committee for advice, opening up a new pool of potential listings.
With dual-class shares, different classes of shares may have different voting rights and different dividend payouts, for example. Advocates say they give a listing company more flexibility.
Yesterday, Mr Loh also took the opportunity to defend the Singapore market, saying that it has been performing consistently over the years. The benchmark Straits Times Index (STI) has returned a total of 5.7 per cent a year over the past 10 years, just a shade under the annual 6 per cent of the Dow Jones Industrial Average, the main blue-chip index on the New York Stock Exchange.
Compared with other developed markets, only Hong Kong did better than the STI, while the Nikkei returned just 1.5 per cent a year, and London only 1.6 per cent a year.
He also addressed criticisms on the lack of big mainboard listings, saying that last year, listed companies raised a total of $4 billion in fund-raising exercises such as bond and rights issues.
He said: "This, coupled with the significant increase in bond issuance, clearly underscores the strength of our capital markets...
"Given our fundamentals and sound reputation, we can and will continue to remain a strong and enduring market, delivering stable, long-term returns for investors and companies alike."
At the seminar, experts also discussed the Singapore and Asian markets for the rest of the year.
Mr David Kuo, chief executive of Motley Fool Singapore, said that he still likes Singapore Reits while OCBC senior investment strategist Vasu Menon was bullish on emerging markets, saying value has emerged after the recent sell-off.
This article was first published on Jan 29, 2016.
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