A designated board for trading in suspended stocks?

OVER the past months, attracting retail investors back into the stock market and restoring confidence lost in last October's penny-stock crash have become a challenge for the authorities.

Better education, higher quality offerings, faster and stricter regulatory action, upfront collateral, a minimum trading price of 20 cents, an independent listing committee and improved short-selling disclosure are among the moves either proposed or already accepted as ways to strengthen the market and to stimulate retail participation.

There is yet another which the Singapore Exchange (SGX) and the Monetary Authority of Singapore (MAS) can consider, and it comes courtesy of a dealer who spoke to BT recently - the setting up of a third board in addition to the mainboard and Catalist, for trading of suspended stocks. There are now 24 stocks which have been suspended over the past five years, many of which are China stocks or S-chips as they are popularly known. Reasons for their suspension are well-known - some of the companies of these stocks encountered severe financial problems and may be technically bankrupt; others have been found to have accounting and/or governance irregularities or, perhaps, are even the victims of outright fraud.