MAS Amends Rules on Residential Property Loans by Banks
MAS published amendments to the Notices 645A and 1106B related to the residential property loans in Singapore, along with amendments to the Notice 635 on unsecured credit facilities to individuals. The amendments shall take effect on November 09, 2020. The Notices 635 and 645A apply to all banks in Singapore while and Notice 1106B applies to all merchant banks in Singapore.
Notice 645A sets out requirements on computing the total debt-servicing ratio (TDSR) for property loans. It sets out the formula and parameters for banks to compute the total debt-servicing ratio, monthly total debt obligations, and gross monthly income of borrowers. The notice also spells out the limit on monthly repayment installments for the purchase of Housing Development Board flats and executive condominiums. Additionally, Notice 1106B sets out rules for merchant banks when granting residential property loans to individuals and non-individuals, including limits on loan amount, conditions for loans, and tenure of credit and refinancing facilities. Finally, Notice 635 sets out requirements for banks when granting an unsecured non-card credit facility to an individual.
Effective Date: November 09, 2020
Keywords: Asia Pacific, Singapore, Banking, Merchant Banks, Debt Servicing Ratio, Credit Risk, TDSR Requirements, RRE, MAS
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