The Taiwan Stock Exchange will begin cross-trading with the Singapore and the Tokyo stock exchanges next year, the bourse's president said on December 10, in a bid to bolster its position after the launch of the Shanghai-Hong Kong trading link.
The Taiwan Stock Exchange (TWSE) and the Singapore Stock Exchange (SGX) will be ready to allow their investors to trade stocks on both bourses in July 2015, TWSE president Michael Lin told Reuters.
The TWSE is also in active talks with the Tokyo Stock Exchange and expects to reach agreement next year to have their investors buy and sell exchange traded funds (ETFs) on both markets, Lin said.
"The Shanghai-Hong Kong Stock Connect has been a huge success, prompting us and most Asian bourses to seriously think about the importance of cross trading," the president said. "Taiwan regulators are very supportive of our tie-ups."
Taiwan's top finance regulator said in August that Taiwan would study the possibility of trading local and Japanese firms on both stock exchanges.
Some foreign and local fund flows have switched from Taiwan to China markets, partly because of the Shanghai-Hong Kong trading link as well as Taiwan's plans to introduce a controversial capital gains tax.
Taiwan's main index has fallen 4.3 percent since early September with turnover shrinking, while the Shanghai bourse surged 33 percent during the same period.
For the tie-up between the TWSE and the SGX, they will each pick a custodian bank.
"All of the global names that have been in the custodian bank business are interested," Lin said, declining to identify which banks have approached the TWSE.
Separately, the TWSE expects daily turnover to jump to T$120 billion ($3.9 billion) in 2015, its highest in three years, from T$115 billion forecast for this year, said the president.
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