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 Once the proposed notices take effect, MAS Notices 634 and 11082 will be repealed.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 Board of Governors of the Federal Reserve System (FED) adopted the final rule on Adjustable Interest Rate (LIBOR) Act.
The European Central Bank (ECB) published an updated list of supervised entities, a report on the supervision of less significant institutions (LSIs), a statement on macro-prudential policy.
The Hong Kong Monetary Authority (HKMA) published a circular on the prudential treatment of crypto-asset exposures, an update on the status of transition to new interest rate benchmarks.
The European Commission (EC) adopted the standards addressing supervisory reporting of risk concentrations and intra-group transactions, benchmarking of internal approaches, and authorization of credit institutions.
The China Banking and Insurance Regulatory Commission (CBIRC) issued rules to manage the risk of off-balance sheet business of commercial banks and rules on corporate governance of financial institutions.
The Hong Kong Monetary Authority (HKMA) made announcements to address sustainability issues in the financial sector.
The European Banking Authority (EBA) published regulatory standards on identification of a group of connected clients (GCC) as well as updated the lists of identified financial conglomerates.
The General Board of the European Systemic Risk Board (ESRB), at its December meeting, issued an updated risk assessment via the quarterly risk dashboard and held discussions on key policy priorities to address the systemic risks in the European Union.
The Financial Conduct Authority (FCA) is seeking comments, until December 21, 2022, on the draft guidance for firms to support existing mortgage borrowers.
The Financial Stability Board (FSB) published a report that assesses progress on the transition from the Interbank Offered Rates, or IBORs, to overnight risk-free rates as well as a report that assesses global trends in the non-bank financial intermediation (NBFI) sector.