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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 2 Monitoring Hedge Funds in Singapore
 

Hedge funds and hedge fund managers are an increasingly important segment of our asset management industry. The number of hedge fund managers grew by 51% to 109 in 2005. Correspondingly, hedge funds assets under management more than doubled year-on-year to US$6.1 billion.

Singapore-based hedge fund managers employ a multitude of investment strategies, including equity long-short, distressed debt, convertible arbitrage and multi-strategy. In terms of geographical coverage, these hedge fund managers range from pan-Asian to global in focus.

With the continued growth of the hedge funds industry in Singapore, we conducted a survey covering all banks and merchant banks to determine the Singapore banking sector’s exposure to hedge funds. The survey showed that, as at May 2005, the banking industry did not have significant exposure to the hedge funds industry.

Most of the hedge fund managers operating in Singapore restrict their fund management activities to not more than 30 qualified investors and are therefore exempted from licensing. Effective July 2005, exempt fund managers and their key officers are required to comply with the Guidelines on Fit and Proper Criteria, and report the size of assets under management and whether they are managing hedge funds.

MAS will continue to monitor international developments in the hedge fund industry and fine-tune our regulatory approach in Singapore in consultation with market participants.