SGX Rulebooks
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3.6.1

This Rule applies only to Trading Members that hold a Capital Markets Services Licence.

Added on 3 June 20193 June 2019.

3.6.2

A Trading Member shall immediately notify SGX-ST if the Trading Member's exposure to a single customer exceeds 20% of its average aggregate resources. To reduce the Trading Member's risk exposure to a single customer, SGX-ST shall have the right to impose on the Trading Member such risk management measures as it deems necessary.

Added on 3 June 20193 June 2019.

3.6.3

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.

3.6.4

"Exposure to a single customer" means the sum of the following:

(a) in the case of securities carried in a customer's account (other than a margin financing account operated under Rule 3.10) carried on the books of a Trading Member:
(i) for purchase contracts that remain unpaid:
(I) where the securities purchased have not been delivered to the customer, the excess of the contracted price of the securities purchased by the single customer over the aggregate market value of the securities purchased and such other collateral, as prescribed by SGX-ST, that is held by the Trading Member less any amount due and payable by the Trading Member to him; and
(II) where the securities purchased have been delivered to the customer, the excess of the contracted price of the securities purchased by the single customer over the aggregate market value of all his collateral, as prescribed by SGX-ST, that is held by the Trading Member less any amount due and payable by the Trading Member to him;
(ii) for sale contracts for which delivery has not been made, the excess of the amount of the market value of the securities sold by the single customer over the aggregate of the market value of any of his collateral, as prescribed by SGX-ST, that is held by the Trading Member and the contracted sale price less any amount due and payable by the Trading Member to him;
(iii) where the contracts referred to in Rule 3.6.4(a)(i) or (ii) have been offset by a transaction on or before the due date, the exposure shall not include those amounts specified in Rule 3.6.4(a)(i) or (ii) in respect of such contracts but shall instead include the amount of the loss, if any, arising from the offsetting transaction, on the date on which the offsetting transaction takes effect; and
(iv) where the contracts referred to in Rule 3.6.4(a)(i) or (ii) have been offset by a force-sale or buying-in transaction after the due date, the exposure shall not include those amounts specified in Rule 3.6.4(a)(i) or (ii) in respect of such contracts but shall instead include the amount of the loss, if any, arising from the force-sale or buying-in transaction, on the date on which the transaction takes effect;
(b) the amount of margin deficiency in the single customer's margin financing account carried on the books of the Trading Member as determined in accordance with the margin requirements specified by SGX-ST;
(c) the amount of margin deficiency in the single customer's options margin account carried on the books of the Trading Member as determined in accordance with the option margin requirements specified by SGX-ST;
(d) the excess of the amount owed by the single customer in his options trading account carried on the books of the Trading Member over the market value of options held;
(e) the amount of any unsecured interest owed by the single customer;
(f) the amount of any unsecured loan, advance and credit facility granted to the single customer;
(g) where the Trading Member has lent securities to the single customer or is acting as guarantor for the return of securities lent to the single customer, the excess of the amount of the market value of the securities lent to the single customer over the amount of the market value of collateral and cash deposited by the single customer;
(h) where the Trading Member has deposited collateral with the single customer in respect of securities lent by the single customer or is acting as guarantor for the return of collateral deposited with the single customer in respect of any securities lent by him, the excess of the amount of the market value of collateral and cash deposited with the single customer over the amount of the market value of the securities lent by him; and
(i) the amount of deficiency in relation to margins required in any account of the single customer carried on the books of the Trading Member as determined in accordance with the margin requirements prescribed by the relevant exchange, clearing house or other such relevant financial institution.

Added on 3 June 20193 June 2019.

3.6.5

For the purposes of this Rule, a security or futures contract is deemed to be carried in a customer's account (other than a margin financing 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 futures contract or on the exercise date specified in the exercise notice in respect of an option in that security that has been exercised.

Added on 3 June 20193 June 2019.

3.6.6

"Single customer" in relation to a customer who is:

(a) a person, means that person and such group of persons who the first-mentioned person is able to control or influence;
(b) a Corporation, means that Corporation and any other Corporation or group of Corporations that is related, as specified in the Companies Act, to the first-mentioned Corporation; or
(c) a person, means that person and:
(i) any Corporation whose issued share capital is 50% or more owned by those persons mentioned in Rule 3.6.6(a) or any other Corporation or group of Corporations that is related, as specified in the Companies Act to the first-mentioned Corporation; or
(ii) any Corporation whose composition of board of directors is controlled by those persons mentioned in Rule 3.6.6(a); and for this purpose the composition of the board of directors shall be deemed to be controlled by those persons, if they, by the exercise of some power exercisable by them without the consent or concurrence or any other person, can appoint or remove all or a majority of the directors of that Corporation,

but shall not include the Trading Member itself.

Added on 3 June 20193 June 2019.