Steps to make SGX stronger

SINGAPORE - A number of changes have been proposed by the Monetary Authority of Singapore (MAS) and the Singapore Exchange (SGX) to strengthen the local stock market. This follows last October's penny stock crash.

The proposed measures, unveiled yesterday, include having a minimum trading price for mainboard-listed shares. This is meant to reduce volatility.

The regulators are also proposing a requirement of collateral from punters with open positions.

Another suggestion is to have investors' short-selling positions disclosed.

A public consultation paper has been issued, and interested parties have until May 2 to give feedback.

The proposals come after MAS and SGX carried out an extensive review of the securities market in Singapore.

It concluded that while the securities market remains sound, there were three areas for improvement. A joint statement by MAS and SGX listed these as:

- promoting orderly trading and responsible investing

- improving the transparency of market intervention measures and

- strengthening the process for admitting new listings and enforcing against listing rule breaches.

MAS assistant managing director of capital markets Lee Chuan Teck said: "This consultation allows us to have a conversation with all stakeholders on how to make the market stronger and more mature."

SGX chief executive Magnus Bocker said: "It encompasses structural and regulatory aspects crucial to a well-functioning securities market." Some other SGX measures will take effect from March 3. For instance, it will publish a "trade with caution" announcement when a company is unable to explain unusual trading activities.

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