Robust Banking and Insurance Sectors

Cessation of industry-wide support measures for individuals and small and medium-sized enterprises (SMEs)

24 June 2021 

MAS, together with the Association of Banks in Singapore (ABS) and the Finance Houses Association of Singapore, announced a final extension of industry-wide support measures for individuals and SMEs in Tier 1 and 2 sectors that continued to face financial difficulties due to the COVID-19 pandemic. The industry-wide support measures were first introduced in 2020 to help ease the financial strain of individuals and SMEs impacted by the COVID-19 pandemic.

31 December 2021

With continued economic recovery and transition to an endemic COVID-19 situation, all industry-wide credit and insurance COVID-19 support measures ceased as of 31 December 2021. To support customers who still faced challenges, banks, finance companies and insurers continued to offer customised support measures to eligible borrowers and policyholders tailored to their individual circumstances.

MAS lifted dividend restrictions imposed in 2021 on local banks and finance companies 

MAS lifted dividend restrictions, a pre-emptive measure introduced in July 2020 to ensure that local banks and finance companies maintain strong lending capacity to support the economy throughout the COVID-19 pandemic. The decision took into consideration the improved global economic outlook and the strong capital adequacy ratios of local banks and finance companies. 

Consultation paper on the proposed implementation of the final Basel III reforms in Singapore

13 September 2021

MAS consulted on the draft bank capital standards to implement major components of the final Basel III reforms in Singapore. The proposals would improve the resilience of the banking system once finalised.

MAS issued Regulations to enhance the resolution regime for financial institutions

1 November 2021

MAS issued new Regulations to strengthen MAS’ ability to carry out an orderly resolution of financial institutions, while minimising disruption to the financial system. Identified banks incorporated in Singapore and their subsidiaries would be required to include enforceable provisions in financial contracts governed by foreign law, to ensure that any termination rights for such contracts will be subject to MAS’ temporary stay powers in the event of a resolution. Existing regulations that safeguard set-off and netting arrangements in the event of a compulsory transfer of business during resolution were extended to cover reverse and onward transfers of business. 

Residential mortgage pricing and disclosure practices – observations and supervisory expectations from thematic inspections

MAS published an information paper on residential mortgage pricing and disclosure practices of large mortgage lenders. The paper highlights good practices and sets out MAS' supervisory expectations in the areas of (i) transparency; (ii) consideration of customer’s interests; and (iii) accountability and product governance over banks’ mortgage lending business. MAS also consulted on new requirements for financial institutions to enhance mortgage disclosures and is working with ABS to raise consumer awareness and strengthen industry standards. 

Extended SGD facility to support lending by banks and finance companies to SMEs amid economic headwinds from COVID-19 pandemic

MAS extended the MAS SGD Facility for Enterprise Singapore (ESG) Loans in July 2021 and February 2022, to complement corresponding extensions of ESG’s Temporary Bridging Loan Programme. The Facility continues to provide low-cost Singapore Dollar funding to banks and finance companies for a two-year tenor, to support lending under ESG’s loan schemes up to 30 September 2022. Loans are provided at an interest rate of 0.1% per annum up to the April 2022 application window, and at an interest rate of 0.5% per annum from the May 2022 application window onwards. Collectively, the Government’s risk sharing through ESG’s loan schemes and MAS’ lower-cost funding through the Facility will continue to keep borrowing costs low for local enterprises to support their cashflow needs.