Singapore: MAS to make it easier for banks to invest in non-financial businesses

• Jun 28, 2017

SINGAPORE: Banks will soon find it easier to invest in non-financial businesses with the Monetary Authority of Singapore (MAS) looking at easing regulations.

The upcoming policy change was announced on Tuesday evening (Jun 27) as the authority seeks to update its framework separating banks’ financial and non-financial business.

Speaking at the 44th annual dinner of the Association of Banks in Singapore, Finance Minister Heng Swee Keat said banks will not need to seek regulatory approval before acquiring major stakes in non-financial businesses related to, or which complement their core financial business. This will be capped at 10 per cent of the bank’s capital funds and will exclude businesses such as property development.

MAS will also remove detailed requirements such as conducting regular stress tests or external audits, Mr Heng said. However, he added that MAS will continue to require banks and their boards to put in place necessary risk management governance arrangements.

Separately, Mr Heng said MAS will allow banks to engage in operating digital platforms that match buyers and sellers of consumer goods and services, provided they complement or are related to the bank’s core business.

MAS will provide operation details of these policy changes in a consultation paper that will be released by the end of September, Mr Heng said.

He urged industry players to maintain their edge with innovation. “One in five consumers in the Asia Pacific are using digital wallets, and Singapore is the top adopter in ASEAN. So I’m pleased to see MAS and the industry working closely together to promote innovation and use of technology. There is indeed strong interest to test-bed new ideas in Singapore.”

Source: http://www.channelnewsasia.com/news/business/mas-to-make-it-easier-for-banks-to-invest-in-non-financial-8983234