Singapore Exchange

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Singapore Exchange Limited
新加坡交易所
Type Stock exchange
Location Singapore, Singapore
Founded 1 December 1999
Key people Chew Choon Seng (Chairman)[1]
Magnus Böcker (CEO)
Low Check Kian (Lead Independent Director)
Currency Singapore dollar, US dollar[2]
No. of listings 776
Website sgx.com

Singapore Exchange Limited (SGX, SGX: S68) is an investment holding company located in Singapore and provides different services related to securities and derivatives trading and others.[3] SGX is a member of the World Federation of Exchanges[4] and the Asian and Oceanian Stock Exchanges Federation.[5]

Singapore Exchange trades continuously from 9 am to 5 pm. From 1 August 2011, Singapore Exchange introduced continuous all-day trading for the securities market.[6] As a result, the lunch break, between 12:30 pm to 2.00 pm, was scrapped.

Structure[edit]

SGX operates several different divisions, each responsible for handling specific businesses.

  • SGX ETS (Electronic Trading System): provides global trading access to SGX markets where 80 percent of the customers are from outside Singapore.[7]
  • SGX DT (Derivatives Trading): provides derivatives trading.[8]
  • SGX ST (Securities Trading): provides securities trading.[9]
  • SGX DC (Derivatives Clearing): subsidiary for clearing and settlement operations.[10]
  • SGX AsiaClear: offers clearing services for over-the-counter (OTC) oil swaps and forward freight agreements.[11]
  • SGX Reach: an electronic trading platform.[12]
  • Central Depository Pte Ltd: subsidiary responsible for securities clearing, settlement and depository services.[13]
  • Asian Gateway Investments Pte Ltd: wholly owned subsidiary[14]
  • Singapore Exchange IT Solutions Pte Ltd: provides computer services and maintenance as well as software maintenance[15]

Listing[edit]

The companies listed on SGX belong to one of two groups: the companies listed on the SGX Mainboard and the companies listed on SGX SESDAQ. In order to be listed on the mainboard, a company has to fulfill some requirements set forth by SGX, while a listing on SESDAQ is not tied to the fulfillment of any additional conditions.[16]

Trading system[edit]

The exchange launched SGX QUEST (SGX Quotation and Execution System) in August 2004. The system is used by the exchange for derivatives and securities trading.[17]

Trading hour[edit]

Pre Open 7:30 AM To 8:00 AM Market Open 8:00 AM To 5:30 PM Pre Close 5:30 PM To 6:00 PM Close 6:00 PM

History[edit]

Formation of SGX[edit]

SGX was formed on 1 December 1999 as a holding company. The share capital of some former exchange companies, namely Stock Exchange of Singapore (SES), Singapore International Monetary Exchange (Simex) and Securities Clearing and Computer Services Pte Ltd (SCCS) was cancelled and new shares issued in these companies were fully paid up by SGX. In this way, all assets previously owned by these three companies were transferred to SGX. The shareholders previously holding shares in SES, Simex and SCCS received newly issued SGX shares.[18]

Second Listed Exchange in Asia-Pacific[edit]

On 23 November 2000, SGX became the second exchange in Asia-Pacific to be listed via a public offer and a private placement[citation needed] (Australian Securities Exchange was listed in 1998). Listed on its own bourse, the SGX stock is a component of benchmark indices such as the MSCI Singapore Free Index and the Straits Times Index.

Joint Venture[edit]

On 25 September 2006, the Joint Asian Derivatives Exchange (JADE), a joint venture between SGX and Chicago Board of Trade (CBOT) became operational.[19] However, this joint venture was cancelled in November 2007, with CME Groups selling of its 50% stake in the joint venture to SGX. The contracts previously traded on JADE were transferred to SGX's QUEST trading platform.[20]

In August 2009, SGX formed a joint venture with Chi-X Global, called Chi-East.[21] At the beginning of October 2010, this joint venture received approval from the Monetary Authority of Singapore to operate a dark pool trading platform.[22]

Acquisition[edit]

In March 2007, SGX bought a 5% stake in Bombay Stock Exchange for 42.7 million dollars.[23]

On 15 June 2007, Tokyo Stock Exchange, Inc. announced that it had acquired a 4.99% stake in SGX.[24] Since then the value of the shares has declined and the Tokyo Stock Exchange, Inc. has made a decision to sell the shares it holds in SGX to its parent company, the Tokyo Stock Exchange Group, Inc.[25]

On 31 January 2008, SGX acquired a 20% stake in Philippine Dealing System Holdings Corp, which has become an associated company of SGX.[26]

At the beginning of 2008, SGX reached an agreement to buy at least 95% of Singapore Commodity Exchange.[27] On 30 June 2008, SGX completed the acquisition of Singapore Commodity Exchange Ltd (SICOM), which now is a 100% subsidiary.[28][29][30][31]

Representative Office[edit]

On 18 April 2008, SGX opened a representative office in Beijing.[32][33]

On 8 June 2010, SGX announced it has opened an office in London.[34][35][36] This is part of SGXs move to invest S$250 million into its Reach initiative.[37] By implementing this initiative, SGX plans to create the world's fastest trading engine and a data centre as well as further connecting trading communities in the world to Singapore. The new trading platform, SGX Reach, will be delivered to SGX by NASDAQ OMX, Voltaire and HP.[38] This platform is based on GENIUM, a trading platform developed by NASDAQ OMX.[39]

Partnership[edit]

SGX has entered a partnership with NASDAQ OMX. Together they will provide a suite of tools and solutions for companies, which is designed to support listed companies in Asia.[40]

Dual currency trading[edit]

SGX plan to introduce dual currency trading of securities — Which includes stocks, bonds and other listed investments in two different denominations, the Singapore and US dollar on 2 April 2012.[2]

Financial Performance[edit]

As of 31 January 2010, SGX had 774 listed companies with a combined market capitalisation of S$650 billion. The revenues of SGX are mainly from the securities market (75%) and derivatives market (25%).

SGX reported a net profit of $165.8 million for the first half of its financial year 2010. Excluding non-recurring items, net profit was 7% higher compared to 1H FY2009 ($159.2 million). In the second quarter of the financial year 2010, excluding the non-recurring items, net profit of $77.0 million was 3% higher than a year ago. Operating revenue increased 6% to $324.0 million (1H FY2009: $304.9 million).[citation needed]

Flash Crash[edit]

A 3-day flash crash in October 2013 which saw some stocks drop up to 87 percent, causing the exchange to lose $6.9 billion in capitalization, resulted in new regulations being announced in August 2014. Minimum trading prices of 0.20 cents per share would be introduced, short positions would be required to be reported, and a 5 percent collateral levy implemented. The exchange said the measures were to curb excessive speculation and potential share price manipulation.[41]

Merger talks[edit]

Merger talks with ASX[edit]

SGX was in a merger talks with Australian Securities Exchange (ASX), which will create a bourse with a market value of US$14 billion had the deal been successful.[42][43]

The Australian Competition and Consumer Commission said on 15 December 2010 that it would not oppose SGXs takeover of ASX.[44]

Criticism from Tokyo Stock Exchange[edit]

SGX's plans to buy ASX have drawn criticism from the Tokyo Stock Exchange, which is the second largest shareholder in SGX. A representative of the TSE said SGX's bid for ASX "would flag off a race to consolidate".[45] TSE chief Atsushi Saito fears isolation of the Tokyo Stock Exchange as a result of the takeover.[46]

Revision of takeover proposal[edit]

SGX revised its initial takeover proposal in an attempt to overcome some of the opposition to the plans. This would have decreased the number of Singaporean citizens on the board of the combined company and would have given addition seats to Australians.[47]

Rejection of merger[edit]

However, on 8 April 2011, the Australian Treasurer and Deputy Leader of the Australian Labor Party, Wayne Swan, made the decision to block the merger between the two exchanges. Upon the announcement that the federal government would block the merger, SGX retracted its bid for ASX shares and decided to seek growth opportunities elsewhere.[48]

Cooperation and merger talks with LSE[edit]

As of July 2012, SGX is in merger talks with the London Stock Exchange (LSE)[49] and the two exchanges already signed a cross trading agreement.[50] However, on 20 July SGX said there are no plans for a takeover of or merger with LSE.[51]

Companies listed on Singapore Exchange[edit]

As of 31 December 2012, there were 776 listed companies on the Singapore Exchange with a market capitalisation of SGD 934.543 billion.[52]

Dec 2012
Domestic Listings 472
Foreign Listings

(excluding China)

159
China Listings 145
Total listings 776

Major shareholders[edit]

The following is a listing of the shareholders of Singapore Exchange Ltd holding at least 5 percent as of 31 July 2012:[53]

  • SEL Holdings Pte Ltd – 23.41%
  • Citibank Nominees Singapore Pte Ltd – 10.62%
  • DBS Nominees Pte Ltd – 7.50%
  • DBSN Services Pte Ltd – 5.65%

References[edit]

  1. ^ "J Y Pillay to step down as SGX chairman at year-end". Channel NewsAsia. Retrieved 14 September 2010. 
  2. ^ a b "SGX introduces dual currency trading". Channel NewsAsia. Retrieved 23 March 2012. 
  3. ^ Singapore Exchange Ltd, Reuters, retrieved 21 September 2010  Archived at WebCite
  4. ^ Singapore Exchange, WFE, archived from the original on 2011-06-06, retrieved 21 September 2010  Archived 5 June 2011 at WebCite
  5. ^ Member Directory & Profile, AOSEF, retrieved 21 September 2010  Archived 5 June 2011 at WebCite
  6. ^ "SGX Market Trades Non-Stop All Day From 1 August 2011". SGX. Retrieved 27 July 2011. 
  7. ^ Huat Tan, Chwee (2002). Singapore Financial and Business Sourcebook. Singapore University Press. p. 140. ISBN 9971-69-256-2. 
  8. ^ SGX Offers Derivatives Trading Via Internet, Internetnews.com, retrieved 12 October 2010  Archived 5 June 2011 at WebCite
  9. ^ Exchange: Singapore Exchange Securities Trading Limited (SGX-ST), emoney.co.ir, retrieved 24 November 2010 [dead link]
  10. ^ Huat, T. C. (2005). Financial markets and institutions in Singapore (11th ed.). Singapore: Singapore University Press / NUS Publishing. p. 248. ISBN 978-9971-69-314-5. 
  11. ^ About SGX AsiaClear, Singapore Exchange Ltd, archived from the original on 29 May 2009, retrieved 12 October 2010 [dead link]
  12. ^ SGX to invest $250m in new trading platform technology, bobsguide, retrieved 12 October 2010  Archived at WebCite
  13. ^ The American Stock Exchange and Singapore Exchange Begin Trading ETFs in Singapore, Farlex Inc, retrieved 12 October 2010  Archived 5 June 2011 at WebCite
  14. ^ Singapore Exchange Ltd's Subsidiary Acquires 49% Shares in Energy Market Company Pte Ltd, Reuters, retrieved 3 September 2012  Archived 28 January 2013 at WebCite
  15. ^ "Investments in Subsidiaries", The Asian Gateway Singapore Exchange Annual Report 2012 July 2011 - June 2012, Annual Report, Singapore Exchange Ltd, 2012, p. 122 
  16. ^ Singapore Exchange (SGX), ADVFN, retrieved 15 April 2011  Archived 5 June 2011 at WebCite
  17. ^ Singapore Exchange adopts Financial Information eXchange Protocol to strengthen position in global financial markets, ASIA PAC, archived from the original on 11 October 2008, retrieved 12 October 2010 
  18. ^ Shaw, A., Singapore Stock Exchange — Demutualization and Listing of the Singapore Exchange Limited, archived from the original on 16 November 2004, retrieved 21 October 2010 
  19. ^ JADE Begins Trading With TSR 20 Rubber Futures Contract, CME Group, retrieved 1 October 2010  Archived 5 June 2011 at WebCite
  20. ^ CME gives up on JADE with SGX sell-up, FOW, retrieved 1 October 2010  Archived 5 June 2011 at WebCite
  21. ^ Ex-BlocSec CEO to lead Chi-East dark pool, The Trade News, archived from the original on 2011-06-06, retrieved 10 October 2010  Archived 5 June 2011 at WebCite
  22. ^ Chi-East receives MAS approval to operate dark pool trading platform, Channel NewsAsia, archived from the original on 30 August 2012, retrieved 10 October 2010 
  23. ^ Timmons, Heather (7 March 2007), Bombay Stock Exchange sells 5% stake to Singapore Exchange, The New York Times, retrieved 1 October 2010  Archived 3 September 2012 at WebCite
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  25. ^ Board Report for March 2009 – 1. Handling of Shares in Singapore Exchange Ltd., Tokyo Stock Exchange Group, Inc., retrieved 13 October 2010  Archived 5 June 2011 at WebCite
  26. ^ Philippine Dealing System Holdings Corp Becoming Associated Company of Singapore Exchange Limited, Singapore Exchange Limited, retrieved 1 October 2010  Archived 30 August 2012 at WebCite
  27. ^ SGX to take majority stake in Singapore Commodity Exchange, Finextra Research, retrieved 22 July 2011  Archived at WebCite
  28. ^ Singapore Exchange Limited Completes Acquisition of Singapore Commodity Exchange Limited, Thomson Reuters, retrieved 1 October 2010 [dead link]
  29. ^ Singapore Exchange Ltd acquires Singapore Commodity Exchange, Alacra, Inc., retrieved 9 February 2012  (subscription required)
  30. ^ Singapore Exchange Ltd. Summary Annual Report 2008, Singapore Exchange Ltd., p. 9 
  31. ^ "Financial Statements for the Full Year Ended 30 June 2009", Supplemental Listing Document, Singapore Exchange, p. 18 of 35, retrieved 27 January 2013 
  32. ^ Singapore Exchange opens Beijing representative office, Finextra, retrieved 2 October 2010  Archived 5 June 2011 at WebCite
  33. ^ Singapore: The Singapore Exchange opens Beijing representative office, Asia Legal Business, retrieved 2 October 2010  Archived 5 June 2011 at WebCite
  34. ^ SGX expands in London, Singapore Exchange Limited, retrieved 21 October 2010 
  35. ^ SGX expands in London, The Trade News, archived from the original on 2011-06-06, retrieved 21 October 2010  Archived 5 June 2011 at WebCite
  36. ^ SGX establishes London office to better serve European customers, MediaCorp Pte Ltd, retrieved 21 October 2010 
  37. ^ SGX to boost trading speeds, global links, Singapore Press Holdings Ltd, retrieved 21 October 2010 
  38. ^ SGX invests $250 million to offer fastest access to Asia, WFE, retrieved 21 October 2010  Archived 5 June 2011 at WebCite
  39. ^ Gateway to Asia, The NASDAQ OMX Group, Inc., archived from the original on 2011-06-06, retrieved 21 October 2010  Archived 5 June 2011 at WebCite
  40. ^ Singapore Exchange Partners With NASDAQ OMX to Offer Innovative Corporate Solutions to Asian Companies, DGAP News Service, retrieved 12 April 2011 
  41. ^ "Singapore Exchange regulators change rules following crash". Singapore News.Net. Retrieved 2 August 2014. 
  42. ^ "SGX, Australian stock exchange in merger talks". Channel NewsAsia. Archived from the original on 30 August 2012. Retrieved 22 October 2010. 
  43. ^ Singapore stock exchange bids $8.3bn for Australian ASX Archived 5 June 2011 at WebCite
  44. ^ "ACCC clears proposed acquisition of ASX by Singapore Exchange". Commonwealth of Australia. Archived from the original on 5 June 2011. Retrieved 7 January 2011. 
  45. ^ "Singapore's bid to buy stock exchange stings Australia's prestige". China Post. Archived from the original on 5 June 2011. Retrieved 19 March 2011. 
  46. ^ "Tokyo fears stock exchange merger plan". Archived from the original on 5 June 2011. Retrieved 19 March 2011. 
  47. ^ Shani Raja; Sarah Jones (15 February 2011). "Singapore Exchange Recasts ASX Bid to Fight Lawmaker Opposition". Bloomberg. Archived from the original on 5 June 2011. Retrieved 18 April 2011. 
  48. ^ "SGX eyes other opportunities". Channel NewsAsia. Retrieved 10 April 2011. 
  49. ^ Mangan, S.; Armstrong, R. (19 July 2012). "LSE, Singapore exchange in merger talks: report". Reuters. Archived from the original on 30 August 2012. Retrieved 30 August 2012. 
  50. ^ "SGX and LSE Sign Cross Trading Agreement". FinanzNachrichten.de. July 11, 2012. Archived from the original on 30 August 2012. Retrieved 30 August 2012. 
  51. ^ "Singapore exchange denies LSE merger talks". Reuters. 20 July 2012. Archived from the original on 2012-09-04. Retrieved 4 September 2012. 
  52. ^ SGX market statistics
  53. ^ "Statistics of Shareholdings", The Asian Gateway Singapore Exchange Annual Report 2012 July 2011 - June 2012, Annual Report, Singapore Exchange Ltd, 2012, p. 163 

Further reading[edit]

External links[edit]