A Financial Network for Excellence in Training to be set up. Details of Financial Sector Development Fund announced.

18 January 2001... The Monetary Authority of Singapore (MAS) announced today a framework of strategies to strengthen and sustain excellence in financial manpower will be established. The new two-pronged framework comprises the setting up of a Financial Network for Excellence in Training, and the deployment of the Financial Sector Development Fund (FSDF) to support programmes to enhance the financial sector capabilities in Singapore.

Speaking at the Wharton-SMU Conference on "Financial Market Liberalisation" this morning, MAS' Deputy Managing Director Mr Tharman Shanmugaratnam said that a resilient and responsive infrastructure was necessary to underpin sustained competitive advantage in financial services. Said Mr Shanmugaratnam, "What ultimately defines us as a successful financial centre will be the infrastructure of rules, networks and capabilities that encourages Singapore-based players to seize new business opportunities, that attracts new financial activities to Singapore, and that stimulates innovation on a continuous basis." In his speech, he highlighted that a vibrant financial centre must ultimately rest on the availability of hard and soft infrastructures that add value to financial players. This would include developing credibility through laws and regulations, world-class communications and payments networks, the informal information networks that create "buzz", and the availability of a deep pool of talent and skilled manpower.

Mr Shanmugaratnam noted that Singapore's high quality of educational infrastructure and openness to talent has been critical to its growth as a financial centre. However, the strength of manpower capabilities in Singapore's financial centre, which was currently a competitive advantange, was not a given. Said Mr Shanmugaratnam, "As Singapore extends its financial catchment beyond the region, the competition we face in skills and talent vis-a-vis other major centres will sharpen. The quickening pace of innovation in global financial services will also demand a more rapid and continuous infusion and upgrading of skills."

To address the new challenges, MAS has, in consultation with the industry, developed a framework of strategies to strengthen and sustain excellence in financial manpower. The framework comprises two-prongs:

1. Setting up of a Financial Network for Excellence in Training - to provide a collaborative approach towards financial sector training, and seek synergies within the financial industry and with top quality training providers.
   
2. Deployment of the Financial Sector Development Fund -- to co-fund programmes to enhance expertise and skills of executives in the industry.

Financial Network for Excellence in Training

Mr Shanmugaratnam said that the main gaps in the current training landscape were in more technical, specialized courses targeted at mid-level and senior executives, including training workshops and courses in new and emerging product lines that require specialist skills and expertise. Going forward, the development of know-how and capabilities in technology for finance, and in e-finance, will be a major imperative for the financial industry as it competes in an increasingly technology-driven environment. The need to equip staff with knowledge of technologies will be required all down the line, from CEOs to bank staff in branches, and across front-office, risk management and back office functions.

To address these challenges, Mr Shanmugaratnam announced that MAS will be setting up a Financial Network for Excellence in Training by the middle of this year. This new Collaborative Network will be formed from local institutions of higher learning and renowned international training providers. The 3 Singapore universities, 4 polytechnics, the Singapore College of Insurance (SCI), INSEAD, University of Chicago and the New York Institute of Finance (NYIF) have expressed a keenness to participate in this new Network.

The Network will be overseen by a Council comprising leading financial industry associations and players and leading training providers, which will focus on the following areas of collaboration:

1. identification of emerging or future need for skills and expertise in the industry, and the matching of such needs with top quality training programmes or other innovative solutions to meet such needs;
   
2. collaboration among financial industry players to pool together their training demands, within Singapore and the region, thereby creating a critical mass of participants for specialized programmes that would be costly to conduct separately;
   
3. encouraging synergies and tie-ups in the supply of training resources, and the sharing of best practices in training.

The Council will also advise MAS on the standards of professional competence necessary for individuals seeking licenses to practice in the financial sector (e.g. dealers and investment representatives). It would provide an ongoing mechanism for refining industry standards and benchmarking qualifications.

Role of the Institute of Banking and Finance

Touching on the role of the Institute of Banking and Finance (IBF), Mr Shanmugaratnam further announced that the IBF has decided that it would be timely to phase out its training provider role and to focus instead on adding value through proactive collaboration with the industry and training providers. The affiliations and broad membership base built up by IBF since its establishment in 1975 make it well-placed to take on the responsibility of running the new Financial Network for Excellence in Training.

The re-distribution of IBF programmes to the polytechnics, universities and other private training providers will be carefully implemented, to ensure no gaps in the spectrum of financial training programmes currently offered by IBF. All the courses currently offered by the IBF will continue to be conducted until their completion, without any disruption to course participants.

The IBF also currently administers qualifying examinations and certifications for individuals seeking licenses to engage in certain financial activities. MAS and IBF will study whether IBF should continue to perform this function or whether the role can be effectively undertaken by other institutions.

Financial Sector Development Fund

Mr Shanmugaratnam also released today the details of three schemes set up under the Financial Sector Development Fund (FSDF) to enhance the expertise and skill of Singapore's financial sector. Formed from the proceeds from the sale of shares of the new Singapore Exchange, the intention was for the FSDF to be used to support the development and upgrading of skills, research programmes and infrastructure to support the Singapore financial sector. With the successful listing of the SGX in November 2000, S$0.5 billion of funds have been transferred to the FSDF. The FSDF will be further augmented when an additional 25% of shares in the SGX (currently held by a special purpose holding company) are sold to investors in the future.

The three schemes supported by the FSDF are :

1. Executive Development Scheme (EDS) - to help Singapore-based financial institutions to defray the cost of locally-based training for executive staff.
   
2. Global Enrichment Initiative (GEI) - to help financial executives to tap on world-class know-how in other leading financial centres, through co-funding of overseas training costs and living expenses incurred during the training period.
   
3. Training Infrastructure Enhancement Scheme (TIES) - to co-fund the costs incurred by training providers in the setting up of facilities for the conduct of world-class training programmes for the financial sector.

In conclusion, Mr Shanmugaratnam highlighted that the quality of manpower will be a defining element of competition between financial centres in future, more than ever before. Said Mr Shanmugaratnam, "Our aim is to promote learning across the financial sector, at all levels, continuously and in pace with emerging business opportunities and risks. It is part of the critical infrastructure that will make Singapore a superior place to conduct financial activities."

Applications for the FSDF Manpower Development Schemes are now open. Financial institutions keen to apply for the schemes are to enquire with the Financial Sector Promotion Department of the MAS.

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