Currently, both SGX and MAS have a supervisory role in respect of securities and derivatives brokers and trading and dealing representatives. SGX undertakes its supervisory role partly through annual on-site inspections. MAS does so in its capacity as the supervisor of licensees. By streamlining routine on-site inspections under a single body, a more efficient supervisory regime will be established for SGX member firms. Brokers can expect to receive fewer inspection visits as the need for SGX to duplicate inspections with MAS has been removed.
SGX will retain other supervisory functions such as oversight of listed companies, admission of members, registration of dealers, market surveillance, and risk management for clearing of securities and derivatives. It will also retain capital and other oversight of brokers and the right to conduct inspections or investigations of brokers as and when the exchange deems necessary.
SGX will pay MAS an annual fee of S$2.3 million plus any applicable GST for the next 5 years to defray the costs incurred for performing routine on-site inspections. Overall cost savings for SGX, from streamlining the member routine inspections, will balance out the payment of S$2.3 million plus any applicable GST. SGX does not expect any significant financial impact.
Mr Alan Shaw, Head of Risk Management and Regulation said, "SGX remains committed to its role in supervising the markets and its member companies. The streamlining will eliminate a lot of the current duplication of functions and the increased efficiency of the regulatory framework will enhance the competitiveness of Singapore's financial markets."
