The Tokyo Stock Exchange (TSE) is to abolish its foreign stocks section and move all of the current foreign listings into a single section combining domestic and foreign stocks.
“With this decision to de-compartmentalize foreign listings, the TSE intends to catch up with overseas exchanges such as the New York Stock Exchange in listing both domestic and foreign stocks on the same board,” says a spokesman for Bank of Tokyo Mitsubishi in Tokyo. “Behind the TSE’s decision, although rather belated by international standards, is its intention to entice foreign issuers, particularly Asians, and reinforce its regional standing. This reflects its sense of urgency amid prospect of intensified competition among Asian stock exchanges, with Shanghai and Shenzhen stock exchanges emerging as key regional stock exchanges.”
Currently, of 32 issuers listed on the TSE’s foreign stock section, only two are Asian, one each from Malaysia and Hong Kong.
The TSE plans to finalize the changes as early as May
The TSE set up the foreign stocks section in 1973 with six foreign issues, and the number peaked at 127 in 1991. After the Japanese market bubble burst, the TSE was deluged with de-listing applications, which reduced the listings to the current 32.