MAS updated rules for new housing loans by banks and finance companies. The rules cover borrower-mortgagor and guarantor-borrower requirements, loan tenure and loan-to-value limits, and requirements for the Mortgage Servicing Ratio and the Total Debt Servicing Ratio. MAS also published a consultation paper on revisions to the guidelines on corporate governance for designated financial holding companies, banks, direct insurers, reinsurers and captive insurers incorporated in Singapore. Annex C to the paper sets out the proposed revisions, which take into account international standards and industry good practices; this consultation closes on June 18, 2021.
The guidelines on corporate governance comprise the principles and provisions of the Code of Corporate Governance and additional guidelines for locally incorporated institutions. As MAS will be updating the Corporate Governance Guidelines to replace the 2012 Corporate Governance Code with the 2018 version, consequential amendments arising from the differences in the 2018 Corporate Governance Code will be necessary to the additional guidelines within the Corporate Governance Guidelines. Tables B1 to B3 of Annex B set out these amendments. MAS will also be streamlining the additional guidelines to remove expectations that are already contained within the Corporate Governance Regulations and MAS’ Guidelines on Risk Management. The proposed amendments to the additional guidelines are set out in Table B4 of Annex B.
MAS will expect locally incorporated banks, Tier 1 insurers, and designated financial holding companies that own banks or Tier 1 insurers to fully observe the principles of the Corporate Governance Code contained within the Corporate Governance Guidelines. Deviations from Principles 11 and 12 under the sub-section “Shareholder Rights and Engagement” of the Corporate Governance Code are acceptable if they are not relevant in the context of the ownership structure of non-listed financial institutions. For instance, Principles 11 and 12 may not be relevant to financial institutions that are wholly owned by a single parent entity. Where locally incorporated banks, Tier 1 insurers, and designated financial holding companies which own banks or Tier 1 insurers do not observe Principles 11 and 12, this should be explained in their annual reports (for listed financial institutions) or company websites (for non-listed financial institutions).
Comment Due Date: June 18, 2021
Keywords: Asia Pacific, Singapore, Banking, Mortgage Servicing Ratio, Total Debt Servicing Ratio, Credit Risk, RRE, Governance, MAS
Previous ArticleESMA Issues Guidelines on Outsourcing to Cloud Service Providers
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 Banking Authority (EBA) published answers to 29 questions in the Single Rulebook Question and Answer (Q&A) tool in September.
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