Demutualization of Stock Exchanges: Problems, Solutions and Case Studies
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Books, Periodicals, Studies, and Reports
On-line edition: Free of Charge
Hardcopy price: $15.00 ISBN: 971-561-475-2
Pub. Date: 2002
In stock
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This ground-breaking book examines the pros and cons of transforming a stock exchange from a member-owned organization to a for-profit shareholder corporation (demutualization).
Drawing on international and regional experience, the book discusses the financial, regulatory, and governance aspects of demutualization. Pressures from the globalized marketplace, financial integration, and technological advancement are all driving the move toward demutualization. Although demutualization poses challenges for market supervision and regulations, these are now being tackled through new approaches to regulatory oversight.
Demutualization also offers potential opportunities for
- strengthening governance
- offering alternate business models of exchanges
- raising capital and
- improving operational efficiency
About 362 pages.
Hardcopy will be available in April 2003.
Foreword, Principal Authors and Abbreviations [ PDF: 160kb | 22 pages ]
Part I: Issues Involved In Stock Exchange Demutualization
Demutualization of Asian Stock Exchanges–Critical Issues and Challenges by Shamshad Akhtar [ PDF: 437kb | 30 pages ]
- Introduction
- Demutualization: Its Definition, Size and Significance
- Motivation and Driving Factors for Demutualization
- From Mutuality to Demutualization of Exchange
- Benefits of Demutualization of Exchanges
- Regulatory Oversight: Challenges and Responses for Demutualized Exchange
- Financial Viability of Demutualized Exchange
- Conclusion
Background Information on Demutualization by Pamela S. Hughes [ PDF: 260kb | 25 pages ]
- Introduction
- What Demutualization Means
- The Reasons to Demutualize
- The Models
- An Update Since Demutualization
- Conclusion
- APPENDIX I: The Models
Motivations, Mechanics and Models for Exchange Demutualizations in the United States by Roberta S. Karmel [ PDF: 163kb | 13 pages ]
- Overview
- Reasons for Demutualization
- How Demutualization is Accomplished
- Post-Demutualization Models
The Structure of a Demutualized Exchange–The Critical Issues by David Holthouse [ PDF: 145kb | 12 pages ]
- Introduction
- Ownership
- Corporate Governance
- Access Rights
- Risk Management
- Financial Management
- Conclusion
Demutualization of Exchanges–The Conflicts of Interest (Hong Kong) by William Pearson [ PDF: 502kb | 60 pages ]
- Structure of Exchanges
- Regulatory Role and Self-Regulation
- Public Policy Objectives of Stock Market Regulation
- Why Should Demutualization Require a Reassessment of SRO Functions?
- What Responses are Being Developed to Deal with These Problems?
- Conclusion
- Hong Kong’s Framework: Listing of HKEx and the Framework for Dealing with Conflicts of Interest
- APPENDIX 1: Hong Kong Exchanges and Clearing Limited: Reinforcing Hong Kong’s Position as a Global Financial Centre—A Policy Paper
- APPENDIX 2: Memorandum of Understanding for the Listing of HKEx on SEHK
- APPENDIX 3: Section 13 of the Exchanges and Clearing Houses (Merger) Ordinance
- APPENDIX 4: Chapter 38 of the Rules Governing the Listing of Securities on the Stock Exchanges of Hong Kong Limited
- APPENDIX 5: Procedures to Deal with Conflicts of Interest
Demutualization of Exchanges–The Conflicts of Interest (An Australian Perspective) by David Holthouse [ PDF: 167kb | 11 pages ]
- Introduction
- Background to Conflicts
- An Exchange’s Listing
- Regulation of Other Listings
- Supervision of Intermediaries
- Profit Motive versus Supervisory Function
- Public Interest versus the Exchange’s Commercial Interest
- New Business Lines
- Conclusion
Demutualization of Exchanges–The Conflicts of Interest (The Australian Regulator’s Experience) by Claire Grose [ PDF: 102kb | 5 pages ]
- Introduction
- Self-Listing
- Other Conflicts
Regulation of a Demutualized Exchange (Canada) by Pamela S. Hughes [ PDF: 152kb | 14 pages ]
- Introduction
- Role of an Exchange
- Self-Regulation and Government Oversight
- SRO Conflicts of Interest
- Supervision of Listings
- Self-Listing
- Managing Conflicts of Interest
- Prudential Regulation
- Shareholders
- Directors and Officers
- Memoranda of Understanding
- Conclusion
Regulation of a Demutualized Exchange (Singapore) by Lee Boon Ngiap [ PDF: 114kb | 7 pages ]
- Background
- Regulatory Issues Arising from Demutualization
- The Regulatory Relationship between the Monetary Authority of Singapore and Stock Exchange of Singapore
- Conclusion
Regulation of a Demutualized Derivatives Exchange (United States) by Natalie A. Markman [ PDF: 287kb | 27 pages ]
- Introduction
- A New Framework
- Exchange Oversight
- Regulatory Issues Raised by Demutualization
- Conclusion
- APPENDIX 1: Designated Contract Markets for Regulated US Derivatives Exchanges
- APPENDIX 2: Registered Derivatives Transaction Execution Facilities
- APPENDIX 3: The CFTC Market Surveillance Program
Regulation of Demutualized Exchanges (Australia) by Claire Grose [ PDF: 94kb | 5 pages ]
- Legislative Framework
- Australian Securities and Investment Commission’s (ASIC) Powers
- Supervision by Market Operators
- Memoranda of Understanding (MOUs)
- Changes Due to Demutualization
- New Legislation
Part II: Demutualization Case Studies
Australian Stock Exchange—The Conversion to a Demutualized Exchange: ASX’s Experience by David Holthouse [ PDF: 151kb | 14 pages ]
- Introduction
- Background to Australian Stock Exchange’s Demutualization
- Obtaining Member Approval
- Mechanism Used for Conversion
- Changes to the Corporations Law
- The Demutualization Process
- Memorandum of Understanding (MOU) with ASIC
- Demutualization and Listing Outcomes
- Subsequent Supervisory Development: ASX Supervisory Review Pty Limited
- Changes in ASX’s Focus and Activities
- Conclusion
Hong Kong Exchanges and Clearing Limited–Demutualization, Merger and Listing: The Hong Kong Exchanges’ Experience by Lawrence Fok [ PDF: 155kb | 12 pages ]
- Introduction
- Pre-Merger Period: Two Exchanges and Three Clearing Houses
- Merger and Proposal
- Reasons For the Merger
- Market Reform
- Conclusion
Hong Kong Securities and Futures Commission–The Conversion to a Demutualized Exchange: The Hong Kong Regulator’s Experience by William Pearson [ PDF: 201kb | 18 pages ]
- Introduction
- The Need for Reform
- The Reform Process
- Rationalized Market Regulation
- Implementing Legislation: Exchanges and Clearing Houses (Merger) Ordinance
- Key Issues Arising from Hong Kong’s Experience with Demutualization
- APPENDIX 1: Summary of the Exchanges and Clearing Houses (Merger) Ordinance
Singapore Stock Exchange–Demutualization and Listing of the Singapore Exchange Limited by Alan Shaw [ PDF: 208kb | 17 pages ]
- Introduction
- Drivers for Change: The Rationale for Demutualization and Merger
- Impact of Demutualization
- The Merger Act
- The Process of Demutualization
- The Singapore Exchange’s Initial Public Offer
- The Structure of Singapore Exchange
- The Governance of Singapore Exchange
- Listing and Conflict of Interest
- Conclusion
- APPENDIX 1: Procedures to Deal with Conflicts of Interest
Toronto Stock Exchange–From Toronto Stock Exchange to TSE Inc.: Toronto’s Experience with Demutualization by Timothy Baikie [ PDF: 199kb | 16 pages ]
- Introduction
- An Overview of the Toronto Stock Exchange (TSE)
- The Development of Mutual Exchanges
- Consolidation, Globalization and New Competition
- The Demutualization Decision
- Market Regulation by a Demutualized Exchange
- Next Steps
- Conclusion
Demutualization of the Philippine Stock Exchange by Maria Larrie Alinsunurin [ PDF: 220kb | 11 pages ]
- Introduction
- Ownership Structure of the Stock Exchange Upon Demutualization
- Trading Rights
- Corporate Governance
- Business of the Exchange
- Statutory Regulatory Role
The Colombo Stock Exchange (Sri Lanka) by Rajeeva Bandaranaike [ PDF: 155kb | 9 pages ]
- Ownership Structure
- Listing Data
- Corporate Governance
- Business of the Exchange
- The Vision, Mission and Corporate Strategy
- Trading Rights
- Regulatory Framework
- Self-Regulation
- Statutory Regulatory Role
- Investor Protection
- Funding of the Colombo Stock Exchange
- Stock Exchange Seeks to Demutualize
The Kuala Lumpur Stock Exchange (Malaysia) by Securities Commission (Malaysia) [ PDF: 128kb | 7 pages ]
- Introduction
- Ownership Structure of the KLSE
- Listing Data
- Corporate Governance
- Business of the Exchange
- Trading Rights
- Risk Management and Supervisory Issues
- Statutory Regulatory Role
- Stock Exchange Seeking to Demutualize
The Shanghai and Shenzen Exchanges: Business Operation, Governance Structure, and Regulatory Function (People’s Republic of China) by Feng Wei [ PDF: 162kb | 9 pages ]
- Overview
- Business Operation
- Governance Structure
- Regulatory Function
- Outlook on Demutualization
The Taiwan Stock Exchange (Taipei,China) by Wanpo (Mina) Wang [ PDF: 145kb | 7 pages ]
- Ownership Structure of Taiwan Stock Exchange Corporation
- Listing Data
- Corporate Governance
- Business of the Exchange
- Trading Rights
- Risk Management
- Statutory Regulatory Role
- Stock Exchange Seeking to Demutualize
Current Organizational and Regulatory Structure of The Stock Exchange (Thailand) by Klao Sanasen [ PDF: 111kb | 8 pages ]
- Thai Capital Market Structure
- The Stock Exchange of Thailand
ISBN 971-561-475-2
Publication Stock No. 100602
Asian Development Bank
P.O. Box 789, 0980 Manila, Philippines
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