PHILADELPHIA, March 15, 2016 /PRNewswire/ -- Aberdeen Singapore Fund, Inc. (the "Fund") (NYSE: SGF), a closed-end equity fund, announced today that its Board of Directors (the "Board") concluded that it was in the best interest of stockholders to suspend the Fund's managed distribution policy (the "Policy"). The suspension of the Policy does not impact the Fund's overall objective of seeking capital appreciation through investments primarily in Singapore equity securities. Also the Board remains committed to its oversight of the Fund's discount, and intends to continue the Fund's Discount Management and Open Market Repurchase Policies. The observance of unusually wide discounts to NAV of the Fund in the current market environment has led the Board to conclude that share repurchases are a more attractive and potentially more impactful means of managing the discount.
Under the Policy, the Fund paid quarterly distributions at an annual rate, set once a year, that was a percentage of the rolling average of the Fund's prior four quarter-end net asset values ("NAV"). The annual rate was most recently set at 8%, effective with the distribution declared in March 2015. The distributions paid under the Policy were made from current income, supplemented by realized capital gains and, to the extent necessary, paid-in capital, which is a non-taxable return of capital.
During the regular review of the Policy by the Board, among other things, the Board considered the Policy's potential to increase liquidity for common stockholders, and the potential such distributions would have, if any, on narrowing the Fund's discount to NAV. It was also noted that the use of the policy over time, together with market conditions, has diminished the level of unrealized gains available in the Fund to support the Policy.
Closed-end funds typically are traded on the secondary market through one of the stock exchanges. The Fund's investment return and principal value will fluctuate so that an investor's shares may be worth more or less than the original cost. Shares of closed-end funds may trade above (a premium) or below (a discount) the net asset value (NAV) of the fund's portfolio. There is no assurance that the Fund will achieve its investment objective.
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SOURCE Aberdeen Singapore Fund, Inc.