MAS Amends Notice on Related Party Transactions of Banks
MAS amended Notice 643A that addresses requirements for banks to prepare statements of exposures and credit facilities to related concerns or parties. Appendix 1 of the notice contains the form each bank must use to prepare a quarterly statement under section 27(1) of the Banking Act (Cap. 19) while Appendix 2 provides instructions or explanatory notes for completing the statement. The amended notice takes effect on July 01, 2021, a date on which the MAS Notice 639A dated June 06, 2007 is being cancelled.
Notice 643A states that every bank must maintain detailed records of every credit facility from and exposure of the bank or any branch or entity in its banking group with any related concern. A bank must report all its transactions, exposures, and credit facilities in SGD. Every bank incorporated in Singapore that is not a subsidiary of another bank incorporated in Singapore must prepare an additional statement in the form set out in Table 1 of Appendix 1, at the consolidated level. Bank must prepare this statement by aggregating its credit facilities and exposures respectively to each related-party group with that of all its subsidiaries and any other entity treated as part of the bank’s group of entities according to Accounting Standards. For the purposes of reporting under Table 1 of Appendix 1, a bank in Singapore may regard the person as belonging to one or more related party groups. Where a person belongs to more than one related party group, the bank must in relation to such a person report the following under the “Additional Information” section:
- All the related party groups which the person belongs to
- The number of related party group(s) that the bank regards the person as belonging to, for the purposes of this notice
- Where the bank has regarded the person as belonging to only one related party group, whether the bank has previously regarded the person as belonging to another related party group and the reasons why the bank no longer regards the person as belonging to that related party group
Effective Date: July 01, 2021
Keywords: Asia Pacific, Singapore, Banking, Credit Risk, Reporting, Notice 643A, Related Party Transactions, Concentration Risk, Counterparty Credit Risk, MAS
Featured Experts
María Cañamero
Skilled market researcher; growth strategist; successful go-to-market campaign developer
Nicolas Degruson
Works with financial institutions, regulatory experts, business analysts, product managers, and software engineers to drive regulatory solutions across the globe.
David Fihrer
Skilled life insurance actuary; subject matter expert on IFRS 17 and source of earnings
Related Articles
APRA Updates Timelines for Revision of Market Risk Standards
The Australian Prudential Regulation Authority (APRA) released an update on the timelines for revisions to the market risk prudential standards and the implications for the broader capital framework.
BCBS and IOSCO Propose Further Policy Work on Margining Practices
Three global standard-setters launched a joint consultation that reviews the margining practices during the COVID-19 pandemic and identifies potential areas for further policy work.
BoE Seeks Information Before Migrating Statistical Reporting to BEEDS
The Bank of England (BoE) published the Statistical Notice 2021/09 requiring additional information from firms and software vendors to assist in the onboarding and testing phases for migrating statistical reporting to the BEEDS portal.
EBA Finalizes Standards on Alternative SA for Market Risk
The European Banking Authority (EBA) published the final draft regulatory technical standards on gross jump-to-default amounts and on residual risk add-on under the Capital Requirements Regulation or CRR.
FCA Publishes Final Rules on Investment Firms Prudential Regime
The Financial Conduct Authority (FCA) published the final rules on the Investment Firms Prudential Regime (IFPR) to streamline and simplify the prudential requirements for solo-regulated UK firms authorized under the Markets in Financial Instruments Directive (MiFID).
ESAs Propose New Rules for Taxonomy-Related Product Disclosures
The European Supervisory Authorities (ESAs) have delivered to the European Commission (EC) the final report on the draft regulatory technical standards for disclosures under the Sustainable Finance Disclosure Regulation (SFDR).
EBA Advice on Review of Crisis Management/Deposit Insurance Framework
The European Banking Authority (EBA) published an advice to the European Commission (EC) on funding in resolution and insolvency as part of the review of the crisis management and deposit insurance (CMDI) framework.
FSOC Report Issues Recommendations to Address Climate Risks
The Financial Stability Oversight Council (FSOC) released a report in response to the U.S. President's Executive Order on climate-related financial risk.
BIS Paper Mulls Policies to Alleviate Challenges Posed by Big Techs
The Bank for International Settlements (BIS) published a paper that examines the business models and the associated risks posed by big technology firms foraying into financial services sector.
BIS to Launch Asian Green Bond Fund Early Next Year
The Bank for International Settlements (BIS) announced the development of an Asian Green Bond Fund, in collaboration with the development financing community, to channel global central bank reserves to green projects in Asia Pacific.
