MAS published its approach to the macro-prudential policy in Singapore. MAS sets out the objectives, framework, and principles that guide the approach to macro-prudential policy, including its interaction with micro-prudential supervision and monetary policy. In its approach, MAS elaborates on the macro-prudential policy framework while laying out the principles that guide the macro-prudential policy approach and policy toolkit of MAS.
The MAS framework for macro-prudential policy involves the iterative processes of surveillance and risk identification, impact and vulnerability assessment, and policy response. If the MAS surveillance and impact assessments identify a material systemic risk that could impact the financial system or the real economy adversely, MAS will take policy action to remove or mitigate the risk, or build resilience against it. The macro-prudential policy approach of MAS can be characterized as pre-emptive, targeted, calibrated, and multi-pronged. In its approach, MAS also lists the policy tools, along with the particular systemic risk they assess. MAS takes a system-wide perspective in its macro-prudential surveillance efforts. It constantly monitors a broad suite of indicators to identify potential risks and how they may manifest. These indicators cover five broad sectors: banks, non-bank financial institutions, corporates, households, and the external sector. Linkages within and between these sectors are identified through network analyses of balance sheet variables and transaction flow data.
Keywords: Asia Pacific, Singapore, Banking, Macro-prudential Policy, Systemic Risk, CCyB, LTV, MAS
Previous ArticleECB Letter to Members of European Parliament on Its Supervisory Role
In a letter addressed to the industry, the Australian Prudential Regulation Authority (APRA) set out an updated schedule of policy priorities for the banking, insurance, and superannuation industries.
The European Commission (EC) adopted a comprehensive review package of Solvency II rules in the European Union.
The Office of the Comptroller of the Currency (OCC) issued Versions 1.0 of the "Earnings" and "Regulatory Reporting" booklets of the Comptroller's Handbook.
The European Central Bank (ECB) published results of its economy-wide climate stress test, which aimed to assess the resilience of non-financial corporates and euro area banks to climate risks.
The European Banking Authority (EBA) published a report on the use of digital platforms in the banking and payments sector in European Union.
The Hong Kong Monetary Authority (HKMA) published updates on the policy measures that were announced in context of the ongoing pandemic.
The International Swaps and Derivatives Association (ISDA), along with several other associations, submitted a joint response to the Basel Committee on Banking Supervision (BCBS) consultation on preliminary proposals for the prudential treatment of cryptoasset exposures.
BIS published the September issue of the Quarterly Review, which contains special features that analyze the rapid rise in equity funding for financial technology firms, the effectiveness of policy measures in response to pandemic, and the evolution of international banking.
The Basel Committee for Banking Supervision (BCBS) met in September 2021 and reviewed climate-related financial risks, discussed impact of digitalization, and welcomed efforts by the International Financial Reporting Standards (IFRS) Foundation to develop a common set of sustainability reporting standards
The Office of the Comptroller of the Currency (OCC) issued a Cease and Desist Order against MUFG Union Bank for deficiencies in technology and operational risk governance.