MAS appoints three asset managers to invest part of S$5 billion fund to support Singapore stock market

S$50 MILLION FOR EQUITY RESEARCH

MAS also said on Monday that it would set aside S$50 million from the Financial Sector Development Fund to enhance the Grant for Equity Market Singapore (GEMS) scheme. 

This is part of the review group's earlier recommendation to shift toward a more disclosure-based regime. 

"In tandem with this shift, it is important to enhance the quality of equity research as a complementary measure," MAS said, adding that it will facilitate price discovery and fair valuation of companies, enabling investors to make informed decisions.

The industry has also given feedback that research coverage in the small- and mid-cap segment could be improved. 

Besides contributing S$50 million in funding, the GEMS scheme will also be extended by two years to the end of 2028.

Each research report can receive an additional S$1,000, while those that initiate research coverage or cover pre-initial public offering stage and newly listed companies can receive a further S$1,000.

This brings the maximum funding per report from S$4,000 to S$6,000.

There will also be new grant funding to defray costs of research dissemination through digital media and to support research on private companies with strong local presence. 

The listing grant under GEMS will also be expanded to cover Singapore Depository Receipts and Foreign Depository Receipts with underlying Singapore stocks, as well as the listing of primary listed exchange-traded funds (ETFs).

MAS said S$40,000 will be provided per depository receipt issuance, and S$250,000 per primary listed ETF. Cross-listed and feeder ETFs can also receive S$180,000 per listing.

For investors, MAS will be strengthening protection by enhancing recourse avenues.

Based on feedback that retail investors face difficulty in commencing civil action, the regulator will consult on proposals covering three areas – enabling the pursuit of legal action, facilitating self-organisation and providing access to funding.

MAS will consult on proposals to enhance legal provisions to enable investors to ride on court action or civil penalty to seek compensation, to allow representatives to organise and carry out legal action on behalf of investors and on setting up a grant scheme to defray the cost of taking legal action for cases involving market misconduct.

Mr Chee, who is also national development minister, said the proposals seek to strike a balance between making it easier for investors to seek recourse in genuine cases, versus avoiding an overly litigious operating environment where lawsuits increase the operating cost for companies.

He also outlined other strategies that the review group is studying, including how companies can engage shareholders better, enhance the attractiveness of the SGX's Catalist board and promote retail investor participation.

The review group is also looking at board lot sizes and how to encourage collaborations with overseas exchanges to facilitate cross-border trading and listings.

Editor’s Note: An earlier version of this article implied that MAS was reviewing more than 100 submissions. This is incorrect. The figure refers to the number of firms which have expressed interest in the programme. The amount that will be provided per primary listed exchange-traded fund has also been corrected to S$250,000, instead of S$100,000 to S$250,000 as erroneously stated. We apologise for the errors.