‘Implications go far beyond SGX’ should Singapore’s best companies choose to list overseas: Koh Boon Hwee

[SINGAPORE] The Republic needs “an ambitious and broad vision” for its capital markets, as well as a policy framework that will help realise that vision – or risk far-reaching impact that goes beyond the local bourse, said Singapore Exchange (SGX) chairman Koh Boon Hwee.

“Here’s the hard truth: If our best companies choose to list overseas, the implications go far beyond SGX Group,” said Koh in a letter accompanying SGX’s FY2025 annual report published on Monday (Sep 15). “Over time, the entire value chain – investment bankers, corporate lawyers, accountants – will shift to jurisdictions where the action is.”

He added that Singapore “may remain a booking centre, but the talent, innovation and higher-value margins will find their home elsewhere”.

Koh’s comments come as a review group led by the Monetary Authority of Singapore (MAS) aims to revive the capital markets here.

Plans unveiled over the past months include the S$5 billion Equity Market Development Programme to strengthen the fund management ecosystem, boost trading liquidity and encourage more research into Singapore-listed companies.

Other initiatives include tax incentives for companies listing in Singapore, as well as consolidating listing and prospectus disclosures under a single regulator to speed up the process of reviewing a listing.

Minister for National Development Chee Hong Tat, who is also MAS deputy chairman, last week also mooted an index to track listed companies beyond the 30 constituents of the benchmark Straits Times Index.

While Koh said he was “encouraged” that the Equities Market Review Group has taken steps in the right direction, he emphasised that “this is just the start”.

“As we have done so for many other sectors, these efforts must compound at every stage of development,” he said.

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Koh, 74, described Singapore’s remarkable transformation over the past 60 years of independence as “a testament (to) national ambition and collective resolve”.

“From shipping to telecommunications, manufacturing to air hubs, wealth management to venture capital (VC), our progress stems from the courage of our policymakers,” he said.

“At the risk of oversimplification, this arises from two interrelated factors. One: a daring vision of what the future can look like. And two: a policy framework designed to make that vision attainable.”

Koh cited as an example the late Dr Goh Keng Swee’s vision in the late 1960s to transform the swamplands of western Singapore, which laid the foundation for Jurong as a thriving industrial zone that attracted multinational corporations (MNCs).

“The policy framework to accompany and energise this vision led to the creation of the Economic Development Board (EDB) and Jurong Town Corporation (JTC),” said Koh. “The rest is history, reflected in the multitude of MNCs that now call Singapore home.”

He added: “In the same spirit, we must now ask ourselves whether we hold the same ambition for our capital markets.”

He noted, for example, that the VC market in South-east Asia – where nearly 14,000 startups are backed by such private equity financing – cannot be sustained if capital is not recycled.

“While many (of these VC-backed startups) may not succeed, hundreds will mature, each seeking to return capital to investors,” said Koh. “A few may list on the largest global exchanges, while the rest will require a different venue and solution.”

What is clear, Koh added, is that everyone “seeks a vibrant equity market that is liquid and fairly valued”.

“It is my hope that SGX Group will rise to meet this need, supported by an enabling policy framework that aligns market incentives with the long-term growth of the ecosystem.”

However, Koh noted that the government, regulators and SGX Group alone cannot fully shape the outcome for Singapore.

“In addition to being more willing to take first-mover risks, we also need individuals to take greater responsibility for their own decisions. These are inescapable factors that make a market,” he said.

“Therefore, I urge all stakeholders to come together and actively participate in shaping the future of our capital markets. By working collaboratively, we can create an environment that supports innovation, growth and resilience, ensuring Singapore remains a global leader in the financial sector.”

FY2025 performance

For the 12 months ended June 2025, SGX posted its highest-ever full-year top-line and bottom-line results since its listing. This was despite a 2.6 per cent decline in earnings for the second half of the financial year.

Its net profit rose 8.4 per cent, to nearly S$648 million for FY2025, from S$597.9 million a year earlier. In tandem, its operating revenue for the full year climbed 11.3 per cent to S$1.37 billion, from S$1.23 billion.

Net revenue from its cash equities segment rose 18.7 per cent to S$392.7 million, as trading and clearing revenue increased 31.9 per cent to S$221.8 million.

Securities daily average traded value increased 26.5 per cent to S$1.34 billion, and total securities traded value increased 27.5 per cent to S$336.4 billion.

Listing revenue fell 11 per cent to S$26.5 million, as the bourse recorded six new equity listings in the year which raised S$25.7 million, compared with seven new listings the previous year, which raised S$117 million.

Net revenue for SGX’s equity derivatives business rose 13.8 per cent to S$345.9 million, as volumes increased 10.3 per cent to 175.8 million contracts.

SGX chief executive officer Loh Boon Chye received a 3.3 per cent pay boost for FY2025.

He received S$7.82 million in total gross remuneration for the financial year, up from S$7.57 million for the previous corresponding period, even as his fixed pay stood largely unchanged from the year prior at S$1.21 million.

The pay hike was driven by increases to the cash bonus and long-term incentives that Loh received for FY2025. These two segments form the bulk of his total gross remuneration, amounting to more than 80 per cent.

The CEO received a S$3.27 million cash bonus for FY2025, which made up around 41.8 per cent of his total pay. This was up 3.6 per cent from the S$3.15 million cash bonus he received for FY2024.

The cash bonus was determined by the board after taking into account the achievement of “specific quantitative and qualitative targets and objectives”, SGX said in its annual report.

Loh was paid S$3.27 million in long-term incentives, some 3.7 per cent higher than the S$3.15 million he received for FY2024.

This amount included performance shares awarded during the year under the SGX’s performance share plan – an incentive scheme that awards shares depending on the achievement of targets. The targets include strategic and non-financial goals, alongside growth outcomes for scale and relevance relative to peer exchanges and companies.

As at 3.43 pm on Monday, shares of SGX were trading 2.8 per cent or S$0.47 higher at S$17.04.