SGX recorded total operating revenues of S$104.3m and operating expenses of S$66.7m for the six months ended 31 December 2000. Net profit after-tax for the period was S$18.8m, including the full impact of a S$20.5m loss arising from the liquidation of SGX's equity portfolio managed by independent fund managers. As previously announced, the liquidation of the equity portfolio was completed in October 2000 in anticipation of the company's listing.
SGX also declared an interim gross dividend payment of three cents per share, the first since its listing in November 2000. The interim gross dividend will be paid for the half-year ended December 2000.
SGX Chairman, Mr J Y Pillay, commented "The Board is pleased to announce an interim gross dividend of 3 cents per share, and expects to pay the balance of the full year gross dividend of approximately 7.4 cents per share after the fiscal year end."
SGX CEO, Mr Thomas Kloet, added, "As part of our ongoing commitment to increase our portfolio of exchange-related businesses, continuously improve the level of customer satisfaction and service, and enhance shareholder value, SGX plans to launch a number of new products, services, and infrastructural advances in both our securities and derivatives markets during the next six months."
To increase investment opportunities in the local market and to boost the competitiveness and attractiveness of the Singapore market, SGX will introduce a broader range of products, further automate clearing and settlement procedures and improve on services provided to market participants. Amongst others, key initiatives which SGX has identified include an open interface for securities trading, exchange traded funds, securities borrowing and lending, and cross trading linkage with the Australian Stock Exchange (ASX).
Open interface for securities trading
The open interface for securities trading was initiated in September 2000 and is currently at an advanced stage of development. Using widely accepted international protocols, it will provide a wider and more direct distribution of SGX's products. Member firms and information service vendors are currently writing interfaces to technical specifications which SGX delivered to the marketplace in November 2000. The open interface is expected to be ready in the second quarter of 2001.
Exchange traded funds
SGX announced in June 2000 that it would establish a joint venture with the American Stock Exchange (Amex) to list and trade selected Amex-listed exchange trade funds (ETFs) and structured products on SGX Securities Trading (SGX-ST). The joint venture agreement between the exchanges was signed in December 2000. Both exchanges are currently developing an initial product list and working with issuers. The ETFs are expected to begin trading in the second quarter of 2001.
SGX also has plans to introduce domestic ETFs and is working with State Street Global Advisors (SSgA) to create an ETF based on the Straits Times Index (STI). Regional and sector-based ETFs are also anticipated.
Securities Borrowing and Lending
SGX will lead the development of an industry securities borrowing and lending facility. The Central Depository (Pte) Ltd (CDP) is currently working with a global consultant to develop the systems and operational structure. Benefits are expected to include improved investment opportunities for market participants and the creation of an equities options market. It is expected to be operationally ready in the third quarter of 2001.
Linkage with the Australian Stock Exchange (ASX)
In June 2000, SGX formalized an agreement with the Australian Stock Exchange (ASX) to create an electronic linkage for selected Singaporean and Australian equities, and provide an expanded distribution for SGX's products. The linkage will increase the liquidity of participating stocks, and will offer a seamless clearing and efficient regulatory structure for cross-border trading. It is expected to operate in the third quarter of 2001.
