Singapore Exchange toughens listing rules The Singapore Exchange is strengthening its listing standards by requiring that any company wanting to go public must show it has been significantly more profitable for longer than under the bourse's previous rules. The move is a sign that some Asian exchanges are starting to respond to criticism that lax rules have allowed the listing of companies with questionable financial and corporate governance track records. Experts say the root of poor corporate governance in some Asian markets lies in weak listings rules. In May, Hong Kong's market watchdog threatened to make it easier to prosecute investment banks if they allow false information to appear on the prospectuses of companies that float on the exchange. The Singapore exchange on Thursday said companies must now have a market capitalisation at the time of initial public offering of at least S$150m (US$119m), have been profitable in the last financial year, and have an operating track record of at least three years. Companies must also have a minimum consolidated pre-tax profit of at least $30m for the latest financial year. Those replace rules requiring that a company have a market capitalisation of $80m at IPO, and cumulative consolidated pre-tax profit of at least $7.5m for the last three years as well as a minimum pre-tax profit of $1m for each of those years. The new regulations, which take effect on August 10, come as Singapore is competing with Hong Kong for IPOs as it tries to bolster its position as an Asian gateway for capital raising, and share and derivatives trading. About 40 per cent of Singapore's listings come from outside the city-state, including from China. Quality begets quality. The enhanced admission standards will increase Singapore's attractiveness for companies and investors, further strengthening its position as an international financial centre," said Magnus Böcker, Singapore Exchange chief executive. David Gerald, president of Securities Investment Association of Singapore, said: "We welcome SGX's initiative to address key challenges the Singapore stock market faces." Mr Gerald said retail investors would reap significant benefits as they would be more confident that companies listed on SGX are "of good standing and quality." He added that investors could "look forward to a more attractive market that has a higher level of corporate governance overall."