Three brokerages lead-managing the Tokyo Stock Exchange's planned listing have told the bourse it must delay its listing by one to two years if it spins off its regulatory functions, officials said Friday.
Japan's biggest bourse, which aims to go public by the end of next March, will set up an in-house task force and reach a conclusion on the matter around the fall in consultation with the lead managers, the officials said.
Its regulatory division is tasked with cracking down on insider trading and false disclosure. The Financial Services Agency, worried about the possible conflict of interest that a publicly traded bourse could face, has advised the TSE to consider splitting off its regulatory operations.
The lead managers -- Nomura Securities Co., Daiwa Securities SMBC Co. and Nikko Citigroup Ltd. -- also relayed to the TSE their views on two other scenarios involving the regulatory operations.
One is that if the regulatory division is turned into a subsidiary, the earliest a listing would be feasible would be in fiscal 2006, due to preparations for the new structure and disclosure of its operations.
The other is that should the TSE decide to keep its regulatory operations in-house, the TSE could go public by the end of next March, as long as it obtains FSA approval.