Explanatory Brief: Monetary Authority of Singapore (Amendment) Bill 2013 and the Financial Institutions (Miscellaneous Amendments) Bill 2013
1 Acting Minister, Ministry of Culture, Community and Youth and Senior Minister of State, Ministry of Communications and Information, Mr Lawrence Wong, today moved the Monetary Authority of Singapore (Amendment) Bill 2013 (MAS(A) Bill) and the Financial Institutions (Miscellaneous Amendments) Bill 2012 (FI(MA) Bill) for First Reading in Parliament.
2 The MAS(A) Bill enhances and expands the Monetary Authority of Singapore’s (MAS) powers for resolving financial institutions and formalises the existing framework for the issuance of MAS book-entry securities and the regulation of primary dealers. The FI (MAS) Bill makes amendments to certain other Acts under MAS’ purview as a consequence of the amendments to the MAS(A) Bill.
3 MAS has conducted public consultation on the Bills. Comments received have been incorporated, where appropriate, into the Bill.
KEY AMENDMENTS IN THE BILL
4 Amendments have been made to two key areas, which are briefly described below.
(I) Expanded and Enhanced Regulatory Framework for Resolution of Financial Institutions
5 To strengthen the regulatory framework for the resolution of financial institutions in the light of global developments, the existing resolution regime applicable to banks and insurers will be expanded to a wider group of financial institutions. MAS will also be empowered to exercise a wider range of options in dealing with a failed financial institution (FI), including the power to issue directions to a financial institution which is wound up , ceases business or has its licence revoked, to claw-back remuneration of directors and executive officers of the FI, and to share information with foreign resolution authorities
(II) Legal Framework for Issuing MAS Book-entry Securities and Regulating Primary Dealers
6 The amendments formalise the existing a framework for the issuance of book-entry securities by MAS and the appointment of primary dealers. MAS will be able to issue securities in its own name, and to purchase, repurchase, sell and redeem these securities as appropriate. These amendments serve to strengthen the legal and regulatory framework for MAS’ monetary policy operations and the market for MAS book-entry securities.