Media Releases
Published Date: 08 September 2005

MAS Enhances Corporate Governance for Banks and Insurers

Singapore, 8 September 2005...The Monetary Authority of Singapore (MAS) today issued Corporate Governance Regulations ("Regulations") and Guidelines on Corporate Governance ("Guidelines").  The Regulations and Guidelines are enhancements to existing corporate governance requirements for banks, financial holding companies and direct insurers. 

2   The Regulations, which are mandatory, form the minimum corporate governance standards for banks, financial holding companies and significant insurers1 incorporated in Singapore.  The Guidelines, which are based on the Code of Corporate Governance (Code) issued by the Council of Corporate Disclosure and Governance (CCDG), are best practice guidelines applicable to banks, financial holding companies and direct insurers. The Regulations and Guidelines took into account feedback received from a public consultation as well as extensive consultations with the industry. 

3   "The enhancements to the existing requirements reflect our ongoing commitment to promote sound corporate governance practices in Singapore's banking and insurance sectors," said Mr Heng Swee Keat, MAS' Managing Director.  "The standards of corporate governance for banks and direct insurers need to be higher than the other commercial entities, to take into account the unique roles they play in the financial system and the economy.  The revised standards are consistent with global best practices.  MAS will continue to review and update these standards, to ensure that they continue to remain relevant."

The Regulations

4   Requirements that MAS considers essential for sound corporate governance are issued as regulations. These include requirements on the:

  • Composition of the board of directors (Board);
  • Establishment, composition and responsibilities of various board committees; 
  • Separation of roles for the Chairman of the Board and Chief Executive Officer;

5   The presence of an independent element on the Board is important in any corporate governance framework.  Accordingly, MAS has specified the proportion of directors on the Board and board committees who must be independent of the financial institutions' management, business relationships and substantial shareholders.

The key composition requirements are summarised at Annex A (21.2 KB) .

The Guidelines

6. The Guidelines are best practices that banks and direct insurers incorporated in Singapore are strongly encouraged to adopt.  They are based on the Code issued by the CCDG, and supplemented with additional principles and guidelines to take into account the unique characteristics of the banking and insurance business, given the diverse and complex risks undertaken by these financial institutions and their responsibilities to depositors and policyholders. 


7. Banks and significant direct life insurers will be given until their respective annual general meetings (AGMs) in 2007 to comply with the Regulations.  Banks and direct insurers listed on the Singapore Exchange (SGX) should disclose their corporate governance practices and explain deviations from the Guidelines in their annual reports for AGMs held from 1 January 2007 onwards.  Institutions that are not listed on the SGX should disclose the same on their websites.

Enhancing SGX's Corporate Governance Framework

8. MAS will also apply the Regulations to the SGX, with modifications to take into account SGX's regulatory role over its members.  Key among these is the presumption that SGX directors who are related to a SGX member are not considered independent from management and business relationships.  To this effect, MAS has published draft regulations for consultation in January 2005 and is refining them to take into account the feedback received.  We expect to bring the modified regulations for SGX into force later this year.


Click on the following hyperlinks to access:

1) Insurance (Corporate Governance) Regulations 2005 (44.5 KB) 
2) Banking (Corporate Governance) Regulations 2005 (391.5 KB) 
3) Guidelines on Corporate Governance for Banks, Financial Holding Companies and Direct Insurers which are Incorporated in Singapore (71.2 KB) 
4) MAS' response to the feedback from the public consultation 


  A "significant insurer" is a direct life insurer incorporated in Singapore with assets of at least $5billion.