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OUR MISSION
OUR OBJECTIVES
 
Supervision
Inspections and
Supervisory Reviews
New Legislation
Enhancing Regulatory Frameworks
Market and Business Conduct
Risk Management
B THE FINANCIAL SECTOR: KEY SUPERVISORY
AND REGULATORY INITIATIVES
 
  Inspections and Supervisory Reviews 32
 
BASEL II Implementation  
32
 
Box 1 – BASEL II Implementation in Singapore  
33
 
Thematic Inspections Relating to Anti-Money
 
Laundering/Countering Financing of Terrorism
34
 
Thematic Inspections on Asset-Liability
 
and Capital Management for Life Insurers
35
 
Box 2 – Monitoring Hedge Funds in Singapore  
36
 
Thematic Inspections of Corporate Finance Advisers  
37
 
Thematic Inspections on E-trading of Futures Contracts  
37
 
Inspections of Fund Management Companies  
37
 
Box 3 – Developing and Enforcing Supervisory
 
Regimes for Real Estate Investment Trust  
38
 
Box 4 – Thematic Supervisory Work on Financial Advisers  
39
 
  INSPECTIONS AND SUPERVISORY REVIEWS

Box 1 BASEL II Implementation in Singapore
 
Since 2004, MAS has been working closely with the Singapore-incorporated banks to implement new regulatory capital standards (commonly referred to as “Basel II”) proposed by the Basel Committee on Banking Supervision (BCBS).

MAS believes the more risk-sensitive framework under Basel II will lead to improvements in the banks’ risk management practices. This would in turn promote the safety and soundness of our banks, and sharpen their competitive edge.

MAS consulted with the banks to determine how to implement the Basel II proposals in Singapore. To date, we have issued eight consultation papers on Basel II. These contain substantially all the guidance for implementing the new capital framework in Singapore. Besides formal consultations, MAS engaged the banks regularly through meetings and onsite visits to assess their implementation progress. With the banks’ help, MAS also participated in a study coordinated by the BCBS to assess the impact of Basel II.

We are working with industry groups that have been set up to look into the disclosure requirements and regulatory reporting under the new framework.

The new framework also has a number of cross-border implications. In order to avoid the duplication of efforts of both banks and regulators, MAS has actively supported collective initiatives by supervisors from different jurisdictions. These initiatives seek to improve communication and cooperation between supervisors on various implementation issues for banks with overseas operations, including the supervisory validation of the advanced approaches to risk measurement.

Basel II will apply to Singapore-incorporated banks from January 2008, in line with most G10 countries. MAS expects a smooth transition to the new framework as the banks continue to improve their risk management capabilities.