Singapore MAS Tharman Shanmugaratnam: Central Bank to Provide Liquidity During Global Stress to Ensure Financial System & Markets Function Orderly, To Grow Private Credit, Risk Advisory, Philanthropy, FinTech Startups & Net Zero in Singapore
13th April 2023 | Hong Kong
Singapore central bank Monetary Authority of Singapore (MAS) Tharman Shanmugaratnam (Senior Minister & Minister in charge of MAS) address on Singapore as a leading international financial in Asia, and to secure sustained non-inflationary economic growth – Central bank to provide liquidity during global stress to ensure financial system & markets function orderly, to grow private credit, risk advisory, philanthropy, fintech startups & net zero in Singapore. Singapore MAS Tharman Shanmugaratnam: “Amid volatile international financial markets and stresses in global banking, MAS will seek to safeguard the safety and resilience of Singapore’s financial sector. Through regular risk assessments and close supervisory monitoring, MAS ensures that banks in Singapore are well-capitalised, keep healthy liquidity positions, and are underpinned by a stable and diversified funding base. In addition, MAS reviews banks’ regular internal stress tests against interest rate, credit, and other risks. MAS also conducts an annual industry-wide stress test of key financial institutions in Singapore. MAS stands ready to provide liquidity through a range of facilities to ensure that Singapore’s financial system remains stable and financial markets continue to function in an orderly manner at times of global stress.” See below for MAS statement
“ Singapore MAS Tharman Shanmugaratnam: Central Bank to Provide Liquidity During Global Stress to Ensure Financial System & Markets Function Orderly, To Grow Private Credit, Risk Advisory, Philanthropy, FinTech Startups & Net Zero in Singapore “
MAS Tharman Shanmugaratnam on Global Crisis, Singapore as a Leading Financial Centre
12th April 2023 | Prime Minister’s Office (Monetary Authority of Singapore) Addendum to the President’s Address
Mr Tharman Shanmugaratnam, Senior Minister and Minister in charge of MAS:
1. The Monetary Authority of Singapore (MAS) seeks to secure sustained non-inflationary economic growth, a robust and resilient financial sector, and Singapore’s position as a leading international financial centre in Asia.
Sustained Non-Inflationary Economic Growth
2. Major central banks have increased interest rates at an unprecedented pace amid persistent inflationary pressures. Tighter financial conditions globally are helping to dampen inflation, at the cost of slower economic growth and increased financial market stresses. Downside risks to global growth have increased, even as continuing labour market pressures keep inflation elevated. Against this backdrop, the Singapore economy will expand at a slower pace in 2023. Inflation is expected to moderate during the year but will remain higher than the historical norm.
3. MAS has steadily tightened monetary policy since October 2021. This has helped to dampen inflation and anchor inflation expectations. MAS will continue to focus on ensuring medium-term price stability as the basis for sustained economic growth.
Robust and Resilient Financial Sector
4. Amid volatile international financial markets and stresses in global banking, MAS will seek to safeguard the safety and resilience of Singapore’s financial sector. Through regular risk assessments and close supervisory monitoring, MAS ensures that banks in Singapore are well-capitalised, keep healthy liquidity positions, and are underpinned by a stable and diversified funding base. In addition, MAS reviews banks’ regular internal stress tests against interest rate, credit, and other risks. MAS also conducts an annual industry-wide stress test of key financial institutions in Singapore.
5. MAS stands ready to provide liquidity through a range of facilities to ensure that Singapore’s financial system remains stable and financial markets continue to function in an orderly manner at times of global stress.
A Leading International Financial Centre in Asia
6. MAS has partnered the financial industry to develop the Industry Transformation Map (ITM) 2025. It sets out five key growth strategies for the financial sector for 2021 – 2025: enhance asset class strengths, digitalise financial infrastructure, catalyse Asia’s net-zero transition, shape the future of financial networks, and foster a skilled and adaptable workforce. The ITM aims to achieve growth of 4-5% and net job creation of 3,000 to 4,000 per year for the financial services sector, over the five-year period. The financial sector is on track to achieving these targets, growing by an average 4.8% per year and adding an average 7,300 jobs per year during 2021 – 2022.
Enhance Asset Class Strengths
7. MAS will catalyse insurance risk advisory and alternative risk transfer solutions for Asia. We will position Singapore as Asia’s centre for philanthropy by building philanthropy advisory competencies and solutions. We will develop private credit to complement private equity and venture capital funding. MAS will anchor promising FinTech start-ups in Web 3.0, artificial intelligence, and green FinTech. We will also continue to work with the financial industry to broaden and deepen the electronic foreign exchange trading ecosystem in Singapore.
Catalyse Asia’s Net-Zero Transition
8. We will help develop an ecosystem of stakeholders to mobilise capital and support Asia’s transition to a net-zero emissions future. We will develop clear taxonomy criteria to identify green and transition activities for eight key sectors in 2023. We will promote the scaling up of blended and transition finance, to facilitate the decarbonisation of key sectors of the economy. We will also enhance sustainability disclosures and develop data utilities which will facilitate corporate disclosures and investors’ access to companies’ Environmental, Social, and Governance data.
9. From the angle of financial stability, MAS will also work with the industry to enhance its resilience to the risks posed by climate change.
Digitalise Financial Infrastructure
10. Together with industry partners, MAS will accelerate efforts to develop new digital infrastructure and platforms to enhance industry efficiency, access new markets, and promote new models in digital finance. In bond markets, we will develop infrastructure to facilitate more seamless end-to-end issuance, listing and settlement for Asian securities transactions. In the funds industry, we will work with industry participants to pilot digital utilities to reduce settlement time, enhance the efficiency and transparency of post-trade funds settlement for fund managers.
Shape the Future of Financial Networks
11. MAS will continue to enhance cross-border payment connectivity with key partner jurisdictions. We have established bilateral real-time cross-border payment linkages with Thailand and India, and are currently working with Malaysia on a similar linkage. MAS is also working with the Bank for International Settlements Innovation Hub on a multilateral solution to link fast payment systems within ASEAN. Through these linkages, users in Singapore and our partner jurisdictions are now able to transfer funds directly to one another’s bank accounts or e-wallets almost instantly using a mobile number or Quick Response code.
12. Together with the industry, MAS will help evolve an innovative and responsible digital asset ecosystem. We are exploring the potential of distributed ledger technology in promising use cases, particularly in cross-border payment and settlement, trade finance, and pre- and post-trade capital market activities. We are also working with the industry to explore the potential of tokenisation of financial and real economy assets.
Foster a Skilled, Adaptable and Future-facing Workforce
13. MAS and the Institute of Banking & Finance will work closely with the industry and tripartite partners to continuously upskill the financial sector workforce and develop deep capabilities for the future of finance.
14. We will build competencies in growth areas, provide training support for finance professionals at different stages of their careers, develop specialist talent in areas such as sustainability and technology, and groom future leaders in finance through opportunities to gain international exposure and build valuable networks.
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