The Monetary Authority of Singapore (MAS) has directed banks that are on the Association of Banks in Singapore (ABS) rates setting panels to review their processes for setting rates for Non Deliverable Forward foreign exchange contracts (NDFs).
This is an extension of the scope of the independent reviews of rates setting processes that banks are currently undertaking.
MAS has directed the banks to report immediately any irregularities they uncover, and to take appropriate disciplinary action against staff involved in such irregularities.
Teo Swee Lian, Deputy Managing Director, MAS, said, “We have taken this proactive step of directing the banks to do a more comprehensive review because we want to do what is necessary to preserve the integrity of our financial system. The banks’ reviews are still at a preliminary stage. It is premature to speculate on the outcome of these reviews.”
The concurrent work by ABS and the Singapore Foreign Exchange Markets Committee to strengthen the governance process for setting benchmark rates is making good progress. MAS looks forward to their recommendations by the end of the year.
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