MAS Consults on Proposal to Regulate Credit Rating Agencies
Singapore, 23 March 2011…The Monetary Authority of Singapore (MAS) today released a consultation paper on proposed regulation of credit rating agencies (CRAs). In line with global developments and to conform with international standards and practices, MAS is proposing to regulate activities conducted by CRAs. This is to ensure that Singapore remains an attractive location for CRAs to operate in.
2 MAS proposes to require CRAs to be licensed under the Capital Markets Services (CMS) licensing regime under the Securities and Futures Act (SFA) and be subject to licensing obligations. “Providing credit rating services” will be added into the SFA as a regulated activity. Licensees who carry on the business of providing credit rating services will be required to comply with existing Regulations, Guidelines and Notices under the SFA that apply to all CMS licensees.
3 The proposed regulatory regime will include a Code of Conduct for CRAs (Code) which apply specifically to CMS licensees providing credit rating services. The proposed Code is based largely on the Code of Conduct Fundamentals for Credit Rating Agencies, issued by the International Organisation of Securities Commissions, which aims to promote the quality and integrity of the rating process, strengthen CRA analytical independence, strengthen investor protection and enhance protection of non-public information.