Featured Product

    MAS Issues Guidance on Dividend Distributions by Banks

    July 30, 2020

    MAS published a statement guidance on dividend distribution by banks. MAS called on locally incorporated banks headquartered in Singapore to cap their total dividends per share financial year 2020 at 60% of the dividends per share of the financial year and offer shareholders the option of receiving the dividends to be paid for financial year 2020 in scrip in lieu of cash. MAS also announced that it will continue to provide USD via the MAS USD Facility following the extension of MAS’ USD 60 billion swap arrangement with the US FED through March 31, 2021. The MAS USD Facility will offer up to USD 60 billion of funding to banks, to facilitate USD lending to businesses.

    As part of the guidance on dividend distributions, MAS highlights that 60% cap on the dividend balances of local banks for financial year 2020 is in line with the objective of capital conservation within shareholder interests. While the capital positions of local banks are strong, the dividend restrictions are a preemptive measure to bolster their resilience and capacity to support lending to businesses and individuals through an uncertain period ahead for the economy. Earlier, in April 2020, MAS had encouraged banks in Singapore to ensure that sustained lending took priority over discretionary distributions. Nonetheless, given the substantial uncertainties ahead and that global economies are not yet showing sustained signs of recovery, it would be prudent for local banks to put aside a greater portion of earnings during this period. This will bolster the ability of these banks to continue to support the credit needs of businesses and consumers as well as absorb economic shocks should a more adverse scenario materialize. MAS encourages banks to conserve and carefully manage their capital, by exercising restraint in discretionary expenditure and management compensation. 

     

    Keywords: Asia Pacific, Singapore, Banking, Dividend Distribution, COVID-19, Liquidity Facility, Credit Risk, MAS

    Related Articles
    News

    HKMA Publishes Hong Kong Taxonomy for Sustainable Finance

    The Hong Kong Monetary Authority (HKMA) published the Hong Kong Taxonomy for Sustainable Finance.

    May 21, 2024 WebPage Regulatory News
    News

    EU Taking Steps to Set Out and Enforce AI Regulations

    Many believe that the transformative power of generative artificial intelligence (GenAI) has potential to reshape the financial sector in the time to come.

    May 21, 2024 WebPage Regulatory News
    News

    ISSB Releases Digital Sustainability Disclosures Taxonomy

    The themes of the harmonization and interoperability of sustainability disclosure standards among various jurisdictions remain at the top-of-mind for international standard-setting bodies.

    May 21, 2024 WebPage Regulatory News
    News

    BCBS Report Studies Implications of Digitalization of Finance

    The Basel Committee on Banking Supervision (BCBS) published a report that examines the implications of the digitalization of finance for banks and supervisors.

    May 21, 2024 WebPage Regulatory News
    News

    BCBS Consults on Guidelines for Counterparty Credit Risk Management

    The Basel Committee on Banking Supervision (BCBS) is seeking comments, until August 28, 2024, on guidelines for counterparty credit risk management of banks.

    May 21, 2024 WebPage Regulatory News
    News

    BIS Paper Outlines Vision for Future Financial System

    In a recent paper, the General Manager of Bank for International Settlements (BIS) and the Indian entrepreneur (Infosys co-founder) Nandan Nilekani have laid out a vision for the Finternet, which is proposed to be a network of multiple financial ecosystems, much like the internet.

    April 29, 2024 WebPage Regulatory News
    News

    NGFS Outlines Options for Supervisory Review of Transition Plans

    The Network for Greening the Financial System (NGFS) recently published three reports on the use of transition plans to boost sustainable finance and manage climate-related financial risks.

    April 29, 2024 WebPage Regulatory News
    News

    BCBS Issues Discussion Paper on Climate Scenario Analysis

    The Basel Committee on Banking Supervision (BCBS) issued a discussion paper on the use of climate scenario analysis to strengthen the management and supervision of climate-related financial risks.

    April 29, 2024 WebPage Regulatory News
    News

    OSFI Issues Phase2 Consultation on Climate Scenario Exercise for Banks

    The Office of the Superintendent of Financial Institutions (OSFI) recently announced a consultation on the second phase of the Standardized Climate Scenario Exercise (SCSE) for banks and other financial institutions it regulates in Canada.

    April 25, 2024 WebPage Regulatory News
    News

    CFIT to Chair Open Finance Taskforce Announced by UK Government

    The UK government announced the formation of an industry-led Open Finance Taskforce, chaired by the Center for Finance, Innovation, and Technology (CFIT).

    April 25, 2024 WebPage Regulatory News
    RESULTS 1 - 10 OF 8967