TWO former senior employees of UOB Kay Hian Private Limited (UOBKH) were charged on Wednesday for allegedly lying to the Monetary Authority of Singapore (MAS) in relation to reports on a then Catalist aspirant. Lan Kang Ming, 38, and Wee Toon Lee, 34, each face three charges of providing MAS with false information in October 2018 in relation to due diligence reports on an unidentified company applying to list on the Catalist board of the Singapore Exchange. MAS said in a media statement on Wednesday that it was performing an onsite inspection of UOBKH between June and August 2018, to assess the latter's controls, policies and procedures in relation to its role as an issue manager for Initial Public Offering (IPOs). During the examination, Lan and Wee were said to have provided different versions of a due diligence report relating to background checks on a company applying to be listed on the Catalist board of the Singapore Exchange. UOBKH had acted as the issue manager
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Jamie Lee
11 February 2014
The proposed regulation to impose a minimum trading price for mainboard companies is unlikely to create delisting pressure, market watchers say.
Authorities on Friday proposed a raft of regulatory changes, in the wake of the penny-stock collapse in October. The Singapore Exchange (SGX) and the Monetary Authority of Singapore (MAS) announced that they plan to introduce a minimum trading price, possibly within a range of 10 to 20 cents, for mainboard listings.
The proposed rule comes as companies that apply to list on the mainboard have to be listed at at least 50 cents per share, with the two regulators estimating that this could affect 130 to 230 listed firms.
While mainboard companies that do not meet the proposed requirement face delisting, they can easily retain their listed status by undergoing a share consolidation, a banker told BT.
Also, companies with shares that trade below the final minimum share price may have up to 36 months to comply.
The proposed minimum trading price is in line with regulations in the US markets, where a minimum bid price of US$1 is required.
Companies listed in the US tend to undergo a share consolidation to meet such requirements, or to increase participation from institutional investors, who typically shy away from low-price stocks.
In a share consolidation, a company reduces the number of its outstanding shares, and in doing so, boosts the share price.
Society of Remisiers president Jimmy Ho pointed out that companies with shares that do not meet the minimum trading price can also transfer the shares to an alternative trading platform.
“My view is that the companies, if they end up being on Catalist, the general public will still be keen as long as there’s a platform to continue trading,” he said.
This move could lift the average trading value of the market - albeit artificially through the use of share consolidation, a senior broker told BT. He noted that the average trading value of the Singapore market since late-2012 has fallen to under 50 cents - way below its 10-year average.
This has also shown how “the focus on penny stocks has changed the market structure,” he added.
In their consultation paper, SGX and MAS noted that this proposed change fits with an earlier proposal to cut the standard lot size from 1,000 to 100 units.
They noted that this, while benefitting retail investors, could also exacerbate the risks of high volatility with low-price securities.
There is higher risk in penny stock trading, since a small fall in the share price of a penny stock in absolute terms translates to a high percentage of loss.
“This, in turn, makes low price securities more susceptible to excessive speculation and potential market manipulation,” the two regulators noted.