MAS published amendments to Notices 643 and 639A in the context of the requirements for related party transactions of banks. Notice 643 sets out requirements for banks when engaging in transactions with their related parties while Notice 639A sets out requirements for banks for preparing statements of exposures and credit facilities to related concerns. Notices 643 and 639A, which are dated December 12, 2019, take effect on October 01, 2020. Consequently, the earlier versions of these MAS notices—Notice 643 dated November 21, 2016 and Notice 639A dated June 06, 2007—are being cancelled with effect from October 01, 2020.
These notices apply to the locally incorporated full banks and wholesale banks, in addition to the full banks (branch) and wholesale banks (branch). Notice 643 sets out the definition, scope, and general principle governing transactions with related parties. It also covers the responsibilities of banks to maintain oversight and control over their related party transactions to mitigate the risk of abuse arising from conflicts of interest. Notice 639A requires all banks to prepare quarterly statements of their exposures and credit facilities to related concerns using the attached form and explanatory notes. Both these MAS notices have been issued under the Banking Act (Cap. 19).
Effective Date: October 01, 2020
Keywords: Asia Pacific, Singapore, Banking, Credit Risk, Notice 643, Notice 639A, Related Party Transactions, Derivatives, MAS
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