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Singapore-listed small and mid-cap companies band together to have voice heard
Small and mid-cap companies listed on the Singapore Exchange (SGX) have formed an association to improve the local capital market.
The Small and Middle Capitalisation Companies Association (SMCCA) launched on Wednesday afternoon with an initial 22 SGX-listed companies as members. It is the first group to represent some listed companies in the city-state.
“We see a gap in terms of a grouping for small and mid-caps in Singapore,” said SMCCA president Tan Choon Wee in a statement. “There is currently no representative association or voice despite the fact that all of us in the industry want a fair, consistent and vibrant capital market in Singapore.”
The association is overseen by a four-member executive committee that includes Tan, vice president Simon Koo, incoming secretary Brandon Chong and treasurer Jason Fisher.
In two white papers presented at a press briefing in the afternoon, the new association took a look at Singapore's capital market and regulatory framework compared to others in the region.
In the paper “Market Volume Study for Singapore”, SMCCA noted that SGX’s stock market’s monthly trading value in the past five years peaked in October 2010 to US$33.8 billion but declined to a little over half of that to an average of US$17.8 billion a month in the first eight months of this year.
Vincent Chia, SMCCA general manager, said that Singapore is no longer Southeast Asia’s top market by trading value, having been overtaken by Thailand in the past few years and Malaysia in August.
SMCCA emphasised that an illiquid market makes it challenging for listed companies to raise capital for growth and for their stock prices to properly reflect the value of their financial performance.
In the paper “Market Regulation Regime”, the association studied regulatory regimes in other key Asian markets. Unlike Singapore, a Securities Exchange Commission in the other markets so SMCCA said it would have to work closely with SGX to help improve the Singapore capital markets.
On top of broadening its membership base, SMCCA also said it wants to play its role in improving corporate governance practices of listed companies. It plans to share best practices among its members and will also actively engage overseas exchanges, listed companies and market practitioners in this regard.
