(Bloomberg) -- Singapore plans to invest S$5 billion ($3.7 billion) with fund managers to help boost the local stock market, and will start requiring some family offices to deploy a portion of their assets into domestic equities.
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Regulators will also make it easier for companies to list on the city-state’s stock exchange, by switching to a more disclosure-based system for initial public offerings and speeding up the listing approval process.
The initiatives were among a host of new measures unveiled on Friday by a government-led review group that was created to help revive Singapore’s languishing stock market. While the country’s benchmark Straits Times Index recently soared to a record, the broader market has been suffering from a dearth of new listings and low trading liquidity in numerous stocks. Delistings have also outnumbered IPOs for years.
A new S$5 billion “Equity Market Development Programme” will be launched by the Monetary Authority of Singapore, the central bank said. It will invest in selected actively managed funds that are focused on Singapore stocks or deploy a substantial portion of their assets into them.
The financial regulator said the program “aims to incentivize fund managers to bring in greater retail and institutional investor interest,” which should in turn improve trading liquidity, price discovery, and valuations for stocks.
The money managers would additionally be expected to contribute to Singapore by expanding their activities and employing more people, and should invest beyond index component stocks. The process of evaluating eligible fund managers and strategies will start “over the next few months,” MAS said.
The government also plans to make changes to its “Global Investor Programme” — which grants Singapore permanent residency to qualifying foreigners — to channel more money into the local stock market.
Investors who have set up single family offices in Singapore with at least S$200 million in assets under management currently have to deploy at least S$50 million into certain types of investments. They include Singapore-listed securities, privately held companies operating in the country, and funds distributed in Singapore which may in turn invest elsewhere.
The MAS said that new applicants that set up similar family offices under this program will have to deploy the entire S$50 million minimum into Singapore-listed equities. Singapore has over 2,000 single family offices that were granted tax incentives as of 2024, which will not be covered by this requirement.