Singapore’s central bank, the Monetary Authority of Singapore, has taken action to address challenges in the city-state’s stock market. A task force has been established to evaluate measures aimed at improving the vibrancy of the Singapore equities market.
Despite the Straits Times Index showing growth in recent years, Singapore’s stock market has faced issues such as thin trading volumes and more delistings than listings. These challenges have led to a perception of the exchange as “boring,” “unexciting,” and even a “zombie” bourse in the past.
The review group, led by Chee Hong Tat, Singapore’s second minister of finance, aims to tackle these challenges by addressing market challenges, fostering listings, and facilitating market revitalization. Additionally, the group will focus on enhancing regulations to facilitate market growth and foster investor confidence.
One of the key goals of the task force is to identify methods for encouraging private sector participation, including from capital market intermediaries, investors, and listed companies. This collaborative approach is seen as essential in revitalizing the Singapore equities market.
The Monetary Authority of Singapore emphasized that a dynamic equities market is crucial in the capital formation value chain. A liquid market not only enables companies to access capital for expansion but also allows asset owners and the public to participate in the growth of quality companies.
By improving the attractiveness of Singapore’s equities market, the city-state can enhance its reputation as a dynamic enterprise and financial hub. This enhancement will complement Singapore’s innovation and start-up ecosystem, private markets, as well as asset and wealth management sectors.
The Singapore Exchange (SGX) has welcomed the establishment of the review group and pledged to work closely with them. SGX RegCo, the regulatory arm of the exchange, also aims to increase accountability, transparency, and market discipline. According to SGX, a whole-of-ecosystem approach is needed to bring about transformative actions in improving liquidity and listings in Singapore’s equities market.
The efforts of the task force led by the Monetary Authority of Singapore, in collaboration with key stakeholders like the SGX, are crucial in addressing challenges and revitalizing the Singapore equities market. By fostering listings, enhancing market regulations, and encouraging private sector participation, Singapore can strengthen its position as a vibrant financial hub in the region.