The Singapore Exchange (SGX) has reduced the standard board lot size of securities listed on SGX from 1,000 to 100 units as of 19 January 2015.

The reduction will apply to ordinary shares, including shares traded on GlobalQuote, real estate investment trusts, business trusts, company warrants, structured warrants and extended settlement contracts. Existing counters which are listed on the SGX with board lot sizes of 100 or less units will remain unchanged. Counters with a current board lot size of 100 units or more will be consolidated into a single board lot size of 100 units. Investors can also continue to trade in odd lots through the Unit Share Market after the implementation of the board lot reduction from 1000 to 100. The maximum quantity of units that can be traded will also be revised from 999 to 99 in the Unit Share Market.

Together with this change, the subscription and allocation value of shares at the initial public offering for each investor must be at least S$500 based on an integral multiple of a board lot of 100. The listing rules of the SGX Mainboard and Catalist have been amended as to align disclosures in the annual report.

With a smaller board lot trading size it will likely make it more affordable for retail investors to invest in a wider range of equities, enabling more access to blue chip companies hopefully increasing liquidity on the SGX.

The board lot sizes for exchange traded funds, American Depositary Receipts and fixed income instruments, including retail bonds, Singapore Government Securities and preference shares will remain unchanged.

Author

Pong Chen Yih is a principal in the Corporate & Securities team of Baker & McKenzie.Wong & Leow. His main areas of practice are corporate finance, capital market transactions such as initial public offerings, share placements, rights issue and other transactional and advisory matters involving listed companies.

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