"Singapore's Equity Reforms: A New Dawn for IPOs?"

In the heart of Southeast Asia, Singapore's stock exchange, SGX, has been grappling with a quiet period, marked by low volumes and a delisting trend that has outpaced listings. The once vibrant exchange has seen a concentration of businesses with significant stakes held by state investor Temasek, and asset-heavy companies that have struggled with rising interest rates. This has led to SGX being one of the quietest global exchanges in terms of deals and funds raised. But all that could be about to change.

The Singapore government and SGX are now considering aggressive moves to enhance the stock market’s appeal, recognizing that a vibrant exchange is crucial for Singapore’s status as an international financial center. The proposals for revitalizing SGX under consideration aim to increase trading volumes, attract listings, and maintain Singapore’s reputation as a global financial centre. However, the success of these reforms will depend on addressing fundamental issues such as corporate governance and regulatory enforcement to restore investor confidence in SGX.

The Equities Market Review Group has issued its first set of measures to strengthen the competitiveness of Singapore’s equities markets. The measures seek to (1) increase investor demand and the supply of quality listings on the SGX, and (2) streamline the listing regulatory framework to a more disclosure-based regime.

The SGD5 billion Equity Market Development Programme (EQDP) is designed to significantly enhance the liquidity and depth of the Singapore equities market. By providing an initial investment into a range of funds managed by fund managers with strong investment track records and capabilities in Singapore, the EQDP aims to attract more capital inflows and foster a more vibrant market environment.

The EQDP will directly inject SGD5 billion into the market, which will increase the overall liquidity. This injection of capital will provide a substantial boost to trading volumes, making the market more attractive to both domestic and international investors. As stated, "The EQDP will provide an initial investment into a range of funds managed by fund managers with strong investment track record and capabilities in Singapore." This investment will not only support existing fund managers but also encourage new ones to establish operations in Singapore, further deepening the market.

The EQDP will complement tax incentives for fund managers investing substantially in Singapore-listed equities. This tax exemption on qualifying income for Singapore fund managers will incentivize them to allocate a significant portion of their assets under management (AUM) to Singapore-listed equities. The program specifies that "Singapore fund managers may apply for a tax exemption on fees earned from qualifying fund management and investment advisory activities. To qualify, the applicants must, among others, meet minimum requirements for professional headcount and assets under management (AUM) and have, in respect of new funds, at least 30% of AUM invested in Singapore-listed equities." This measure will attract more capital inflows as fund managers seek to maximize their returns by leveraging the tax benefits.

Additionally, the EQDP will support the development of a robust research ecosystem. The expansion of the Grant for Equity Market Singapore (GEMS) scheme to include research coverage on pre-IPO companies and a focus on mid- and small-cap enterprises will enhance market transparency and attractiveness. This will provide investors with more comprehensive information, thereby increasing their confidence in the market. The program notes that "The existing Grant for Equity Market Singapore (GEMS) scheme which was introduced in 2019 will be expanded to include research coverage on pre-IPO companies and to sharpen focus on mid- and small cap enterprises and the eligible dissemination channels under the GEMS scheme will be broadened to include, for example, social medial platforms."

Furthermore, the adjustment to the Global Investor Programme (GIP) will support more capital inflows into Singapore’s equities market. By requiring that SGD50 million of the AUM must be deployed in equities listed on Singapore-approved exchanges, the GIP will ensure that high net worth individuals and entrepreneurs invest a significant portion of their assets in the local market. This will not only increase the depth of the market but also attract more foreign capital, as stated, "Moving forward, the requirements for an SFO will be adjusted whereby the SGD50m of the AUM must be deployed in equities listed on Singapore-approved exchanges. This is to support more capital inflows into Singapore’s equities market."

In summary, the SGD5 billion Equity Market Development Programme is poised to have a transformative impact on the liquidity and depth of the Singapore equities market. By injecting capital, providing tax incentives, enhancing the research ecosystem, and adjusting the GIP, the program will attract more capital inflows and create a more vibrant and attractive market environment for investors.

The proposed tax incentives for fund managers and the adjustments to the Global Investor Programme (GIP) are integral components of Singapore's broader strategy to revitalize its equity market. These measures are designed to attract more capital inflows and enhance the overall liquidity and vibrancy of the Singapore Exchange (SGX).

The Monetary Authority of Singapore (MAS) has introduced a tax exemption on qualifying income for Singapore fund managers. This incentive is aimed at encouraging fund managers to invest a substantial portion of their assets under management (AUM) in Singapore-listed equities. Specifically, fund managers must have at least 30% of their AUM invested in Singapore-listed equities to qualify for the tax exemption. This measure is expected to attract more fund managers to Singapore, thereby increasing the demand for Singapore-listed equities.

The GIP has been adjusted to require that at least SGD50 million of the AUM of a Singapore Family Office (SFO) must be deployed in equities listed on Singapore-approved exchanges. This adjustment is intended to support more capital inflows into Singapore’s equities market. By mandating a higher allocation to Singapore-listed equities, the GIP aims to ensure that high net worth individuals and family offices contribute to the liquidity and growth of the local equity market.

The tax incentives and GIP adjustments are expected to attract more capital from both domestic and international investors. For instance, the SGD5 billion Equity Market Development Programme (EQDP) will provide an initial investment into a range of funds managed by fund managers with strong investment track records in Singapore. This program is designed to grow fund managers' activities and employment in Singapore, thereby increasing the overall investment in Singapore-listed equities.

By encouraging fund managers and high net worth individuals to invest in Singapore-listed equities, these measures are expected to enhance market liquidity. Increased liquidity will make the SGX a more attractive destination for listings and investments, potentially leading to higher trading volumes and better valuations for listed companies.

The tax incentives and GIP adjustments will likely attract a broader range of investors, including institutional funds, family offices, and other private entities. This diversification of investor base will contribute to a more robust and resilient equity market, providing a reliable support base for listed companies.

The tax incentives and GIP adjustments are also expected to make Singapore a more attractive destination for international investors. For example, the tax exemption on fees earned from qualifying fund management and investment advisory activities will incentivize international fund managers to establish operations in Singapore, thereby increasing the inflow of foreign capital.

The measures are designed to support local companies by providing them with access to a larger pool of capital. This will enable local companies to raise funds more easily, fostering their growth and development. For instance, the corporate income tax rebate for new corporate listings in Singapore will encourage more companies to list on the SGX, thereby increasing the supply of quality listings.

In summary, the proposed tax incentives for fund managers and the adjustments to the GIP align with Singapore's broader strategy to revitalize its equity market by attracting more capital inflows, enhancing market liquidity, and improving market depth. These measures are expected to benefit both domestic and international investors by providing them with more investment opportunities and potentially better returns.

The Singapore government and SGX are now considering aggressive moves to enhance the stock market’s appeal, recognizing that a vibrant exchange is crucial for Singapore’s status as an international financial center. The proposals for revitalizing SGX under consideration aim to increase trading volumes, attract listings, and maintain Singapore’s reputation as a global financial centre. However, the success of these reforms will depend on addressing fundamental issues such as corporate governance and regulatory enforcement to restore investor confidence in SGX.

The Equities Market Review Group has issued its first set of measures to strengthen the competitiveness of Singapore’s equities markets. The measures seek to (1) increase investor demand and the supply of quality listings on the SGX, and (2) streamline the listing regulatory framework to a more disclosure-based regime.

The SGD5 billion Equity Market Development Programme (EQDP) is designed to significantly enhance the liquidity and depth of the Singapore equities market. By providing an initial investment into a range of funds managed by fund managers with strong investment track records and capabilities in Singapore, the EQDP aims to attract more capital inflows and foster a more vibrant market environment.

The EQDP will directly inject SGD5 billion into the market, which will increase the overall liquidity. This injection of capital will provide a substantial boost to trading volumes, making the market more attractive to both domestic and international investors. As stated, "The EQDP will provide an initial investment into a range of funds managed by fund managers with strong investment track record and capabilities in Singapore." This investment will not only support existing fund managers but also encourage new ones to establish operations in Singapore, further deepening the market.

The EQDP will complement tax incentives for fund managers investing substantially in Singapore-listed equities. This tax exemption on qualifying income for Singapore fund managers will incentivize them to allocate a significant portion of their assets under management (AUM) to Singapore-listed equities. The program specifies that "Singapore fund managers may apply for a