3.8.1
This Rule applies only to Trading Members that hold a Capital Markets Services Licence.
Added on 3 June 20193 June 2019.
3.8.2
A Trading Member shall immediately notify SGX-ST of its exposure to a single security:
(a) in the case where the security is quoted on SGX-ST or any recognised group A securities exchange, if its exposure to that security (whether in relation to the quantity that is already quoted or to the quantity that is approved for quotation but not yet quoted), exceeds 300% of its average aggregate resources;
(b) in all other cases where the security is quoted, if its exposure to that security exceeds 100% of its average aggregate resources;
(c) in the case where the security is approved for quotation on SGX-ST or any recognised group A securities exchange but has not, as yet, been so quoted, if its exposure to that security:
(i) exceeds 100% of its average aggregate resources if its aggregate resources is less than S$75 million; or
(ii) exceeds 150% of the average aggregate resources of the Trading Member if its aggregate resources is S$75 million or more;
(d) in the case where the security is not quoted, and not approved for quotation on SGX-ST or any recognised group A securities exchange, if its exposure to that security exceeds 10% of its average aggregate resources. This notification requirement does not apply to any security issued by:
(i) any subsidiary of the Trading Member that is established solely for the purpose of providing research, nominee, custodian or trustee services; or
(ii) any other company that SGX-ST may approve.
Added on 3 June 20193 June 2019.
3.8.3
To reduce a Trading Member's risk exposure to a single security, SGX-ST shall have the right to impose on the Trading Member such risk management requirements as it thinks fit.
Added on 3 June 20193 June 2019.
3.8.4
The full amount of the qualifying letter(s) of credit or any part thereof deposited pursuant to Rule 3.4.6 may be taken into account for the calculation of aggregate resources under this Rule.
Added on 3 June 20193 June 2019.
3.8.5
"Exposure to a single security" means the sum of the following:
(a) the amount of the single security underwritten or sub-underwritten by or placed with a Trading Member, after deducting the amount that the Trading Member has sub-underwritten or placed with:
(i) a bank licensed under the Banking Act 1970;
(ii) a merchant bank approved as a financial institution under the Monetary Authority of Singapore Act 1970;
(iii) a finance company licensed under the Finance Companies Act 1967;
(iv) a company or co-operative society that is licensed under the Insurance Act 1966 to carry on insurance business as an insurer;
(v) the holder of a Capital Markets Services Licence under the Securities and Futures Act for dealing in capital markets products or for fund management;
(vi) a financial institution outside Singapore that is licensed or regulated by a financial services regulatory authority in the country in which it is domiciled, and has a long-term credit rating of investment grade; and
(vii) any other person, provided that:
(I) full payment has been received by the Trading Member for the sub-underwritten, placed, sold or allotted amount; or
(II) the sub-underwritten, placed, sold or allotted amount can be offset against collateral received by the Trading Member under a netting agreement;
(b) the book value of the single security carried long, or the market value of the single security carried short in a Trading Member's own account carried on the books of the Trading Member;
(c) for outstanding options in the single security carried in a Trading Member's own options trading account carried on the books of the Trading Member:
(i) the book value of options bought for the account;
(ii) the excess of the market value of the underlying securities over the exercise price of uncovered call options written for the account; and
(iii) the excess of the exercise price of put options written for a Trading Member's own account over the market value of the underlying securities;
(d) in relation to the single security carried in a customer's cash account carried on the books of the Trading Member, the contract value of the single security to the extent that such amounts have not been paid for, or the market value of the single security to the extent that such security has not been delivered, whichever is the higher;
(e) for outstanding options in the single security carried in a customer's options trading account carried on the books of the Trading Member:
(i) the contract value of the options bought by the customer to the extent that such amounts have not been paid for;
(ii) the excess of the market value of the underlying securities over the exercise price of uncovered call options written by the customer; and
(iii) the excess of the exercise price of put options written by the customer over the market value of the underlying securities;
(f) the net amount of the single security borrowed or lent, as the case may be, by a Trading Member;
(g) in relation to the single security bought or carried, or deposited as collateral in the margin financing accounts carried on the books of the Trading Member, the margin exposure of a Trading Member to the single security as determined in accordance with the margin financing requirements prescribed by SGX-ST;
(h) the amount of interest receivable secured by the single security;
(i) the amount of loans and advances secured by the single security; and
(j) the amount under subscription by a Trading Member for its own account carried on the books of the Trading Member in relation to the single security that is approved for quotation on SGX-ST or any recognised group A securities exchange but has not, as yet, been so quoted;
and shall not include exposure arising from a Trading Member's arbitrage transactions.
Added on 3 June 20193 June 2019 and amended on 18 January 2022.
3.8.6
For the purposes of this Rule:
(a) a security is deemed to be carried in a customer's cash account or a Trading Member's own account (such account being an account carried on the books of the Trading Member) on the contract date specified in the contract note in respect of the transaction in that security or on the exercise date specified in the exercise notice in respect of an option in that security that has been exercised;
(b) "security" does not include any security issued by the Singapore government or any public authority in Singapore;
(c) in calculating exposure to any particular security, all outstanding options exercisable into that security shall be included in such computation;
(d) in calculating exposure in any particular security under Rule 3.8.5(b) and Rule 3.8.5(d), all futures contacts with that security as an underlying shall be included in such computation.
Added on 3 June 20193 June 2019.
3.8.7
Where a security quoted on SGX-ST or any recognised group A securities exchange has been suspended for more than 30 consecutive days, a Trading Member shall not permit its exposure to the security to increase in monetary value above the level subsisting on the 30th consecutive day of suspension until such time that the suspension has been lifted.
Added on 3 June 20193 June 2019.