Singapore's Financial System Assessed to be Well-Regulated
Singapore, 14 November 2013…The Monetary Authority of Singapore (MAS) announced today that an assessment under the International Monetary Fund (IMF)’s Financial Sector Assessment Programme (FSAP)1 has found Singapore’s financial sector to be well-regulated and highly developed.
2 The assessment by the IMF affirms Singapore’s standing as a sound and stable financial centre. Some highlights in the report2 include:
- Singapore presents a very high level of compliance with international standards for the regulation and supervision of the banking, insurance and securities sectors, and financial market infrastructures.
- Stress tests conducted under the assessment indicate that banks and insurers are resilient to adverse macroeconomic scenarios.
- Crisis management and resolution arrangements are generally strong. The necessary legal framework is in place, with tools and responsibilities clearly allocated among public bodies and robust arrangements for information sharing and coordination.
3 MAS welcomes the positive assessment of Singapore’s financial system and thanks the financial institutions, industry associations, and professional bodies that were involved in the FSAP. MAS will review the recommendations and take appropriate measures. Mr Ravi Menon, Managing Director of MAS, said, “The FSAP is a rigorous and comprehensive programme. It provided us the opportunity to be independently benchmarked against international best practices and to evaluate policy actions to address any vulnerabilities in our financial system. The assessment is a testament to MAS’ long tradition of prudent regulation and supervision.”
4 The FSAP is an in-depth external assessment that contributes to a deeper understanding of the stability and resilience of a country’s financial sector. As an international financial centre, Singapore is committed to undergoing periodic financial stability assessments. In 2010, the IMF Executive Board decided that Singapore and 24 other jurisdictions with systemically-important financial sectors would undertake a financial stability assessment every five years.1 On 8 January 2013, MAS announced that Singapore would participate in the International Monetary Fund’s Financial Sector Assessment Programme (FSAP) in 2013. Please refer to the 8 January 2013 press release:
2 The findings of the FSAP Mission are summarised in a report called the Financial System Stability Assessment (FSSA). The Executive Board of the IMF has endorsed the FSSA and it was published today by the IMF. A copy of Singapore's FSSA can be obtained from the IMF website.
1. The Financial Sector Assessment Programme (FSAP) was established in 1999. The financial stability assessment comprises three components: (i) an evaluation of the source, probability, and potential impact of the main risks to macro-financial stability in the near-term for the relevant financial sector; (ii) an assessment of the authorities’ financial stability policy framework; and (iii) an assessment of the authorities’ capacity to manage and resolve a financial crisis should the risks materialise. Assessments of compliance with international financial sector standards are an optional but useful component of the FSAP.
2. The FSAP Mission visited Singapore in June 2012, April 2013 and July-Aug 2013, during which the assessors met MAS, other government agencies, and participants from the private sector.
3. The international standards are the Basel Core Principles for Effective Banking Supervision, the International Association of Insurance Supervisors Insurance Core Principles, the International Organization of Securities Commissions (IOSCO) Objectives and Principles of Securities Regulation, and the Committee on Payment and Settlement Systems-IOSCO Principles for Financial Market Infrastructures.