Singapore Sees 54% Jump in Total Treasury Revenue in 2001 - Retains Leading Global Position as World's Fourth Largest Forex Centre
Singapore, 8 November 2002. Singapore sees a 54% increase in total treasury revenue amounting to S$8.0 billion in 2001 compared to the S$5.2 billion in 2000. Profit before tax rose 68%, to S$6.7 billion in 2001 from S$4.0 billion in 2000. This is a credible performance in the face of a 19% dip in global forex trading activity last year as reported in the 2001 BIS Triennial Central Bank of Survey of Foreign Exchange and Derivatives Market Activity. As such, Singapore retains its leading global position as the world's fourth largest forex centre in 2001 with daily foreign exchange turnover averaging about US$95 billion.
2 These developments were highlighted in a speech by Mr Tharman Shanmugaratnam, Senior Minister of State for Trade & Industry and Education at ACI Singapore's annual gala dinner at the Ritz-Carlton Millenia Singapore this evening. The Survey of Singapore Treasury Activities 2001 is an annual survey carried out by the Monetary Authority of Singapore to monitor the developments of the treasury markets in Singapore.
3 In addition, the survey points to the increasing role of capital market transactions such as interest rate derivatives and credit derivatives in the treasury business. Capital activities generated the largest revenue for treasury operations in 2001, accounting for 45% of the total treasury revenue, up from the 28% the year before. Money market activities accounted for 43% contribution of the total treasury revenue. With the increased volume of debt capital market transactions and trading activities in Singapore in 2001, money market and capital market activities collectively generated 88% of total treasury revenue.
4 In his speech, Mr Shanmugaratnam indicated that more financial institutions are moving up the value chain of activities, and are offering products which command higher margins such as structured derivatives, credit derivatives, equity derivatives and other risk management instruments versus that of traditional instruments.
5 The ACI Annual Gala Dinner tonight marks a year of growth for the treasury industry despite economic difficulties in Asia, emphasising the resilience of Singapore. ACI Singapore was set up almost 30 years ago as 'Forex Association of Singapore'. Today, ACI Singapore plays an important role in representing market participants and providing valuable feedback to the authorities on regulatory and developmental matters as well as educating the financial community.