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SGX declares 91 trades of 52.3m New Silkroutes shares as errors
SINGAPORE Exchange (SGX) has declared 91 trades involving 52.3 million shares of New Silkroutes Group as "error trades" resulting from confusion over the recent consolidation of the company's shares, according to a statement by the market operator.
Market sources told The Business Times on Wednesday that more than 50 million shares of New Silkroutes, an energy, healthcare and technology company, had been matched at about 1.5 Singapore cents close to the opening bell.
That price was less than 5 per cent of New Silkroutes' traded price of about 52.5 Singapore cents on Wednesday, which was also the first day that New Silkroutes was trading following a consolidation of every 500 shares into one share.
"In reviewing the cases, SGX was satisfied these transactions were the result of genuine error on the investors' part, attributable to the recent consolidation of New Silkroutes shares, and that allowing the erroneous trades to stand would cause disproportionate harm including the settlement risk of failed trades of significant size," SGX said in a statement.
SGX urged market participants to exercise greater care in dealing with consolidated shares.
"SGX has reminded member firms and their trading representatives to exercise due care when executing orders in newly-consolidated shares including having appropriate safeguards for clients who transact using means such as Internet trading," SGX said. "All market participants should also exercise due care in transacting securities, post any corporate action."