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
Scott is a Director in the Regulatory and Accounting Solutions team responsible for providing accounting expertise across solutions, products, and services offered by Moody’s Analytics in the US. He has over 15 years of experience leading auditing, consulting and accounting policy initiatives for financial institutions.
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