MAS is consulting on notices for management of "outsourced relevant services," which include certain cloud services, by banks and merchant banks in Singapore. Once the proposed notices take effect, MAS Notices 634 and 11082 will be repealed. Banks and merchant banks are expected to comply with the proposed notices when disclosing customer information to service providers under the exceptions permitted in the Third Schedule to the Banking Act. The comment period for the consultation ends on January 29, 2021. A bank or a merchant bank will need to comply with the requirements that relate to outsourcing agreements within 12 months of the date of issuance of the proposed notices, or from the date on which the bank or merchant bank enters into a new agreement or renews an existing agreement, whichever is later.
Services that are covered as outsourced relevant services include public cloud services such as software-as-a-service, platform-as-a-service, and infrastructure-as-a-service. Other services in this category are information technology helpdesks services, data center operations or data center facility management services, express letter and parcel delivery services, and card embossing services. MAS also proposed that relevant services that are not for the conduct of banking business and where the service provider does not have access to a bank or merchant bank's confidential or customer information be considered as exempted outsourced relevant services, and not be subject to the proposed Notices given the nature of such services. To help the industry determine which relevant services are outsourced relevant services, MAS is proposing to set out:
- A non-exhaustive list of relevant services that are commonly performed by banks or merchant banks (Annex A of the proposed notices)
- An exhaustive list of relevant services that are not commonly performed by banks or merchant banks and thus, are excluded from the definition of outsourced relevant service (Annex B of the proposed notices)
- An exhaustive list of relevant services, that are not commonly performed by banks or merchant banks, but are considered by MAS as outsourced relevant services and thus, are subject to relevant requirements in the proposed notices (Annex C of the proposed notices)
Comment Due Date: January 29, 2021
Keywords: Asia Pacific, Singapore, Banking, Merchant Banks, Outsourcing, Cloud Computing, SAAS, MAS
Previous ArticleFIN-FSA Makes Several Regulatory Announcements
The Office of the Superintendent of Financial Institutions (OSFI) published an update on the discussion paper that intended to engage federally regulated financial institutions and other interested stakeholders in a dialog with OSFI, to proactively enhance and align assurance expectations over key regulatory returns.
The European Commission (EC) published a report summarizing responses to the targeted consultation on the supervisory convergence and the single rulebook in the European Union (EU).
The European Central Bank (ECB) published its opinion on a proposal for a regulation on European green bonds, following a request from the European Parliament.
The Advisory Scientific Committee (ASC) of the European Systemic Risk Board (ESRB) published a report that explores the expected impact of digitalization on provision of financial and banking services, and proposes policy measures to address the risks stemming from digitalization.
The Hong Kong Monetary Authority (HKMA) is consulting on the draft Financial Institutions (Resolution) Ordinance (Cap. 628), or FIRO, Code of Practice chapter on liquidity and funding in resolution, until March 14, 2022.
The Swedish Financial Supervisory Authority (FI) announced that the capital adequacy reporting as at December 31, 2021 must be done by February 11, 2022.
The European Banking Authority (EBA) announced that the guidelines on the reporting and disclosure of exposures subject to measures COVID-relief measures shall continue to apply until further notice.
The Central Bank of the Philippines (BSP) issued communications covering developments related to online lending platforms, open finance framework and roadmap, and on the expected regulations in the area sustainable finance.
The Board of Governors of the Federal Reserve System (FED) published the final rule that amends Regulation I to reduce the quarterly reporting burden for member banks by automating the application process for adjusting their subscriptions to the Federal Reserve Bank capital stock, except in the context of mergers.
The European Banking Authority (EBA) published its assessment of risks through the quarterly Risk Dashboard and the results of the Autumn edition of the Risk Assessment Questionnaire (RAQ).