(SGX) and the New York Stock Exchange (
) have signed a memorandum of understanding to promote mutual development and foster cooperation between the two companies.
SGX and NYSE have agreed to work together to develop new ETF products.
The memorandum covers several key areas including efforts to enhance ETF product development, particularly with regard to in-demand segments such as environmental, social, and governance (ESG) strategies.
The agreement also includes working towards dual listing of companies on both exchanges, a move that will benefit issuers by allowing them to tap into pools of capital in markets outside of their home regions while also providing investors on both exchanges with a wider range of investment options.
While not explicitly stated in the memorandum, the dual listing of companies may pave the way for both companies to work towards facilitating the cross-listing of ETFs.
Loh Boon Chye, CEO of SGX Group, commented: “This agreement underscores SGX Group and NYSE’s joint interest in driving greater collaboration between the two exchanges. It aims to create a more connected ecosystem to facilitate access to capital and the development of new investment solutions to address growing complex needs of market participants and investors.”
Lynn Martin, President of NYSE, said: “This collaboration between NYSE and SGX Group creates an important new connection between two of the world’s most exciting regions and two of its most innovative stock exchanges. Our agreement will bring issuers access to greater opportunity as well as drive the development of new products in high-demand areas such as ESG. We look forward to working together with SGX Group to further advance our global capital markets.”
The memorandum follows an agreement entered into at the end of last year between SGX and China’s Shenzhen Stock Exchange (SZSE) which aims at establishing a scheme linking the two bourse’s respective ETF markets. The China-Singapore ETF Connect, which is expected to go live sometime later this year, will involve the listing of so-called ‘feeder’ ETFs which link locally listed ETFs to ones listed on the other exchange.