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Does indefinite suspension of a stock help or hurt shareholders?

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Uma Devi

Uma Devi

Published Thu, Apr 20, 2023 · 05:50 AM
    • A trading suspension is a good way for companies to avoid a plunge in their share prices as they iron out problems, whether solvency issues or regulatory investigations, but this comes at the cost of investors.
    • A trading suspension is a good way for companies to avoid a plunge in their share prices as they iron out problems, whether solvency issues or regulatory investigations, but this comes at the cost of investors. PHOTO: AFP

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    INVESTORS of Singapore-listed companies might be better served if there were stricter rules around trading suspensions. Long-suspended companies without clear means of having the suspension lifted within a strict time limit should be delisted.

    Of the 630 companies listed on the Singapore Exchange (SGX) at the end of March, nearly 10 per cent of them – or 61 stocks – are suspended.

    Current listing rules by the bourse regulator, SGX RegCo, say trading suspensions “may persist for a prolonged period”. But this rule means investors may take years – even decades – to see a resolution. And some companies may even benefit from being able to continue claiming a listed status.

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