Guidelines for stock market issue managers, Catalist sponsors strengthened

The Association of Banks in Singapore has enhanced its guidelines governing the due diligence required of stock market issue managers and Catalist sponsors.
The Association of Banks in Singapore has enhanced its guidelines governing the due diligence required of stock market issue managers and Catalist sponsors. PHOTO: ST FILE

SINGAPORE - The Association of Banks in Singapore (ABS) has enhanced its guidelines governing the due diligence required of issue managers of mainboard listings and full sponsors of Catalist listings.

Some of the key changes in the ABS listings due diligence guidelines include the recommendation for issue managers or  sponsors to query an issuer if there is a recent resignation of management, directors or controlling shareholders.

Issue managers and sponsors should also assess whether an issuer's overseas subsidiary face restrictions on cash remittances.

"The amounts of taxable income and revenue or cost declared in the tax fillings should be reviewed for consistency with the issuers' audited financial statements," the ABS added Friday (May 13) when announcing the enhancememts.

In all, about 10 areas of the guidelines have been strengthened, to ensure the quality of management, business model and financial position of a listing applicant.

The ABS started the industry consultation for the enhancements around nine months ago, just as the Singapore Exchange began ramping up its listing rules.

The SGX has in recent months worked on improving the regulations and transparency on listing applications and listed companies.

Just a day earlier the bourse launched a bi-annual report detailing companies suspended for 12 months or more, and an update on SGX's engagement with these companies.

The SGX expects the enhanced ABS guidelines to help issue managers ensure their compliance of listing admission rules, SGX chief regulatory officer Tan Boon Gin said during the ABS briefing.

He added that the rules and guidelines will not prolong the listing process and turn away potential issuers.