SINGAPORE Feb 7 Singapore is proposing
wide-scale reforms to its equity market rules in the wake of a
penny stock scandal, its central bank and stock exchange
announced on Friday.
The Monetary Authority of Singapore (MAS) and Singapore
Exchange Ltd (SGX) are consulting the market on a
series of changes including minimum trading prices, new
collateral rules, short-selling reporting, and new independent
committees to vet listing applicants and impose regulatory
"This consultation allows us to have a conversation with all
stakeholders on how to make the market strong and more mature,"
said Lee Chuan Teck, assistant managing director for capital
markets at the MAS.
Singapore is one of Asia's leading financial centres, but
its stock market has struggled recently with a drop in trading
volumes and "ultra penny stocks", which trade for as little at
S$0.001, becoming some of the most actively traded shares.
Potential problems in the market surfaced in October when
shares in three companies - Blumont Group Ltd,
LionGold Corp and Asiasons Ltd - crashed and
wiped out about S$8 billion ($6.31 billion) in value after huge
run-ups in their share prices.
SGX is the front-line regulator of the city-state's stock
market and the crashed raised questions about whether it has a
conflict of interest.
SGX and MAS's consultation will run until May 2, 2014.
($1 = 1.2675 Singapore dollars)
(Reporting by Rachel Armstrong; Editing by Matt Driskill)