Monetary Authority of Singapore: ANNUAL REPORT 2012/2013

Monetary Authority of Singapore
ANNUAL REPORT 2012/2013
Monetary Authority of Singapore
CONTENTS
Chairmans Message Board of Directors Management Team Board Committees Organisational Structure 05 08 10 12 13
ROBUST, TRUSTED, AND PURPOSEFUL FINANCIAL CENTRE

A ROBUST FINANCIAL CENTRE Strengthening Capital Requirements for Singapore-incorporated Banks Enhancing Regulatory Capital Framework for Capital Market Services Licensees A Regulatory Framework for Financial Holding Companies Changes to the Qualifying Full Bank Programme Enhance Supervision of Insurers Box 1: Amendments to the Monetary Authority of Singapore Act Monograph on Supervision of Financial Market Infrastructures in Singapore Technology Risk Management Notice and Guidelines Enhancing Corporate Governance Standards Develop and Implement a Regulatory Framework for OTC Derivatives Implementation of Enhanced Regulatory Regime for Fund Management Companies Offers and Prospectuses Electronic Repository and Access (OPERA) Payment System (MEPS+) A TRUSTED FINANCIAL CENTRE Rates Review Strengthen Anti-Money Laundering / Countering the Financing of Terrorism Requirements for Financial Institutions Enforcement of Anti-Money Laundering / Countering the Financing of Terrorism Regulations Industry Sound Practices to Further Safeguard Singapores Wealth Management Sector 26 26 26 26 27 27 28 29 29 29 30 30 30 31 31 31
ANCHOR OF ECONOMIC AND FINANCIAL STABILITY

THE ECONOMY GLOBAL, REGIONAL AND DOMESTIC A Year of Tepid Growth The G3 Economies Underperformed as Fiscal Withdrawals Intensified Growth in Asia ex-Japan Slowed amid Sluggish External Demand Immediate Risks in Financial Markets have Receded Global Inflation was Subdued as Commodity Prices Eased Singapore Experienced a Slowdown amid External Vulnerabilities Domestic Factors Kept Inflation Elevated MONETARY POLICY LIQUIDITY MANAGEMENT Enhancing Our Liquidity Management Framework PBC-MAS Bilateral Swap Arrangement MACROPRUDENTIAL POLICIES Property Measures to Maintain a Stable and Sustainable Property Market Financing Restrictions on Motor Vehicle Loans INDUSTRY STRESS TEST Industry Wide Stress Test / Financial Sector Assessment Programme Stress Test SINGAPORE GOVERNMENT SECURITIES (SGS) Developing the SGS marketIntroduction of 30-year SGS CAPITAL MARKETS DEVELOPMENT Broadening and Deepening Singapores Debt Capital Market 16 16 16 17 17 17 17 19 19 21 21 21 21 21 22 22 22 22 22 22 22
31 32 32
A PURPOSEFUL FINANCIAL CENTRE 32 Foreign Exchange (FX) 32 Developments in OTC Derivatives Markets 33 Asset Management 33 Corporate Debt Market 33 Infrastructure finance 34 Insurance 34 Enhancing the RMB infrastructure in Singapore 34 Asian Dollar Market 34 Promote Local Talent and Leadership Pipeline 35
MAS Annual Report 2012/2013
VALUED PARTNER ON THE INTERNATIONAL FRONT

COMMITTED TOWARDS INTERNATIONAL EFFORTS ON FINANCIAL STABILITY AND FINANCIAL REGULATORY REFORM International Engagements Promote Consolidated Supervision and Cooperation with Foreign Regulators Crisis Management Group Meetings Islamic Financial Services Board Singapores participation in the International Monetary Funds Financial Sector Assessment Programme Strengthening the International Monetary Funds Resources Singapore is Committed Toward International Efforts for Financial Regulatory Reform Concluding an Inter-Governmental Agreement on the Foreign Account Tax Compliance Act Regional Engagements Strengthening Cooperative Ties with Fellow Regulators Executive Meeting of East Asia-Pacific Central Banks Maintaining Strong Bilateral Relations MAS-AMBD Bilateral Meeting Revision of the Chiang Mai Initiative Multilateralisation Agreement Box 2: MAS Lecture 38 38
Box 5: MoneySENSE - Singapore Polytechnic Institute for Financial Literacy MoneySENSE Website ENGAGING THE INDUSTRY MAS Streamlines and Enhances Requirements on Disclosure of Interests in Listed Entities Enhancing Physical Security of the Financial Industry Working with Key Stakeholders Insurance Directors Programme Partnership with Academia
52 52 53 53 53 53 53 54
38 38 38 38 39 40 40 40 40 41 41 41 41 42
ONE MAS: INTEGRATED AND COHESIVE

BUILDING HIGH PERFORMANCE TEAMS AND A STRONG MAS FAMILY Expertise and Leadership Development - General and Functional Training - Regional and External Programmes - Leadership Programmes - MAS Peer Groups - Attachment and Secondment - Engaging Staff - Recognition of Staff Box 6: MAS An Employer of Choice! - National Day Awards FOSTERING CLOSER TIES - MAS Dinner & Dance 2012 - Inter-Central Bank Games 2012 - ChristMAS 2012 RAISING PRODUCTIVITY UPHOLD HIGH GOVERNANCE AND OPERATIONAL STANDARDS WITHIN MAS Procurement Governance and Management Security and Fire Safety Building Services and Infrastructure Risk-Based Audit ENHANCING MAS RISK MANAGEMENT CULTURE, OPERATIONAL RESILIENCE AND CRISIS PREPAREDNESS 58 58 58 58 58 58 59 59 59 59 60 60 60 60 60 61
SERVING THE PUBLIC, ENGAGING STAKEHOLDERS

ENGAGING THE PUBLIC 46 Box 3: The Singapore Third Series Coins 46 Managing Dollars and Cents 47 MAS Website 48 GENESYS 48 PROTECTING CONSUMERS Enhancing Credit Cards and Unsecured Credit Rules Enhancing Regulatory Regime to Raise Market Conduct Standards and Safeguarding Interests of Retail Investors and Public Mystery Shopping Survey Box 4: Raising the Bar for the Financial Advisory Industry Enhancing Market Conduct 48 48
61 61 61 61 61
62
48 48 49 51
FINANCIAL STATEMENTS KEY ECONOMIC AND FINANCIAL STATISTICS STATISTICAL ANNEX
66 98 102
EDUCATING CONSUMERS 51 MoneySENSE 51 - Media Outreach 51 - Outreach Through Other Platforms 51
GLOSSARY 122
Who we are

MAS is the central bank of Singapore. Our mission is to promote sustained noninflationary economic growth, and a sound and progressive financial centre.
MAS FUNCTIONS
To act as the central bank of Singapore, conduct monetary policy, issue currency, oversee payment systems and serve as banker to and financial agent of the Government; To conduct integrated supervision of the financial services sector and financial stability surveillance; To manage the official foreign reserves of Singapore; and To develop Singapore as an international financial centre.
CHAIRMANS MESSAGE
The global economy is on a firmer footing compared to a year ago. The repair of bank and household balance sheets has progressed, most notably in the United States. Central bank actions, including unconventional monetary policies, have reduced the risks of financial instability and a sharp economic recession. A gradual, if modest, recovery in the G3 economies can now be expected in the second half of 2013, supported by a steady improvement in the housing and labour markets in the US and the short-term effects of concerted monetary and fiscal stimuli in Japan. China is expanding at a more moderate pace, but remains an important source of global demand growth. The rest of Asia should also be supported by resilient domestic demand and increasing intraregional trade. Notwithstanding this improved global picture, we have not returned to the path of normal growth, especially in the advanced economies. There is a critical need to reduce an over-reliance on monetary policy and achieve greater progress in structural reforms, so as to promote lasting, self-sustaining growth. However, recurring volatility is likely in financial markets during the transition to more normal liquidity conditions and interest rates over the medium term. Against this backdrop, the Singapore economy is expected to continue on a moderate expansion path of 13% this year. The gradual improvement in the global economy will provide some upside to Singapores external-oriented industries, while domestic demand is likely to stay resilient. Our labour market remains tight. This is supporting wages, as well as a further pass-through of cost pressures. MAS Core Inflation, which excludes
the costs of accommodation and private road transport, could rise moderately in the latter half of this year. CPI-All Items inflation will ease this year, reflecting the gradual slowdown in the increase in imputed rentals on owneroccupied accommodation, and the recent correction in COE premiums due to the package of motor vehicle policy measures. MAS tightened its monetary policy stance in April 2012 by increasing slightly the slope of the S$ nominal effective exchange rate (S$NEER) policy band, with no change to the level at which it was centred. This was a measured step, aimed at averting a build-up of price pressures, anchoring inflation expectations and keeping growth on a sustainable path as the economy restructures. The policy stance was maintained in October 2012 and April 2013. We recognise that inflation will generally be higher than the historical norm during the medium-term transition towards a higher-productivity economy. However, MAS remains vigilant in preventing cost pressures from escalating and ensuring that consumer price inflation stays moderate. Asset market inflation, especially in housing, remains an important focus for MAS. Low global interest rates put pressure on asset prices and credit growth, with potential knock-on effects on both consumer price inflation and financial stability. MAS has applied targeted macroprudential tools to cool investment demand in the property market, complementing monetary policy in promoting sustainable economic and financial conditions. The measures, together with coordinated actions by other Government agencies, have helped to stabilise the market. We continue to monitor their effects.
In keeping with international developments in financial regulation following the recent global financial crisis, MAS has reviewed and refined its rules so as to strengthen our framework for financial stability and ensure robust protection of depositors, insurance policy holders and consumers of financial services. With the passing of the MAS (Amendment) Bill by Parliament earlier this year, MAS has additional resolution powers and a broader range of regulatory options to deal with failed financial institutions, as well as share information with foreign resolution authorities, where necessary. In addition, we have reviewed the framework for the issuance of securities by MAS. We launched the Financial Advisory Industry Review or FAIR in March 2012, aimed at enhancing the quality of financial advice and efficiency in the distribution of life insurance and investment products. FAIR reviewed areas such as operational standards amongst financial advisory firms, competence and remuneration of representatives, and the transparency and accessibility of products to customers. We have also strengthened oversight of the fund management industry in several respects. The enhanced fund management regulatory regime introduces more stringent admission criteria for fund managers such as enhanced capital and competency requirements, as well as higher standards of business conduct. In the banking system, MAS has announced changes to the Qualifying Full Bank (QFB) programme aimed at encouraging foreign banks to deepen their roots in Singapore while strengthening Singapores financial stability. For a very small number of QFBs determined to be significantly rooted, MAS may grant an additional 25 places of business, of which up to 10 being branches, as part of an overall package negotiated under free trade agreements (FTAs) with these QFBs home countries. MAS will consider a range of quantitative and qualitative attributes that demonstrate a QFBs ability and willingness to support Singapores financial
stability and development, in determining if the QFB is significantly rooted. In addition, MAS will require existing QFBs that are important to the domestic market, as well as new QFBs offered under future FTAs, to locally incorporate their retail operations at minimum, so as to enhance depositor protection. In line with measures by regulatory authorities in major international centres, MAS initiated a review of banks financial benchmarks setting processes in July 2012. Upon conclusion of the review, MAS took supervisory actions against several banks for governance and risk management deficiencies. These actions include imposing additional statutory reserves, and requiring banks to plug identified deficiencies and conduct independent reviews to ensure the robustness of enhanced risk management processes and internal controls. Changes to the benchmarks setting processes will also be rolled out progressively over 2013 to strengthen the governance and the design of financial benchmarks and their setting processes. Singapore has been active in global efforts to combat money laundering, terrorism financing and proliferation financing. We operate a rigorous AML/CFT regime, which has been well rated and assessed by the Financial Action Task Force (FATF) to be aligned with international standards. Consistent with the revised FATF recommendations, Singapore criminalised the laundering of proceeds from serious tax crimes from 1 July 2013. We will continue to strengthen Singapores framework for international cooperation, and ensure that our financial system is not used as a harbour or conduit for illicit assets. Overall, financial sector growth remains resilient, with activity seen across most segments of the industry. One key development was the launch in May 2013 of Renminbi (RMB) clearing services in Singapore by the Industrial and Commercial Bank of China (ICBC) Singapore branch. This followed the signing of an MOU between MAS and the Peoples Bank of China on RMB Business Cooperation, which facilitates the use of RMB
in Singapore for cross-border trade and other economic transactions and enhances access to RMB in the region. On 28 May 2013, MAS also opened its Beijing Representative Office. Together, the collaboration between MAS and the Chinese central bank and financial authorities will deepen financial and economic cooperation between China and Singapore, and strengthen regional financial markets. As Singapore continues to develop as a key financial centre in the Asian time zone, MAS will support financial institutions in efforts to develop a strong core of Singaporean financial sector professionals and leaders in finance. These initiatives aim to nurture younger Singaporean entrants with opportunities to be mentored by senior leaders and to broaden their horizons
across various functional roles; to give Singaporean finance professionals the opportunity to deepen specialist skills; and to help more mid-career Singaporeans take on regional and international postings. A solid core of Singaporean specialists and leaders will be critical to fostering and sustaining a strong financial sector workforce over the long term. Mr Lucien Wong, Chairman and Senior Partner, Allen & Gledhill, stepped down from the MAS Board of Directors on 28 February 2013. He had served on the Board since 1 January 2006. On behalf of the Board and Management of MAS, I thank Mr Wong for his active and invaluable contributions. I also welcome Mr Quek See Tiat as a new member of MAS Board of Directors.
Tharman Shanmugaratnam Chairman
BOARD OF DIRECTORS
Tharman Shanmugaratnam
Chairman Deputy Prime Minister Minister for Finance
Lim Hng Kiang

Deputy Chairman Minister for Trade & Industry
Heng Swee Keat

Minister for Education
Lawrence Wong Shyun Tsai

Acting Minister for Culture, Community and Youth Senior Minister of State for Ministry of Communications and Information
Quek See Tiat

Chairman of Audit Committee Chairman, Building and Construction Authority
Lim Chee Onn

Chairman of Risk Committee Senior International Adviser, Singbridge Pte Ltd
Peter Ong Boon Kwee

Permanent Secretary, Ministry of Finance
Tan Chorh Chuan

President, National University of Singapore
Ravi Menon
Managing Director, MAS
Senior Advisor to MAS
Goh Chok Tong

Emeritus Senior Minister
MANAGEMENT TEAM
10 MAS Annual Report 2012/2013
A. Ravi Menon
Managing Director B. Ong Chong Tee Deputy Managing Director Monetary Policy and Investment / Financial Development C. Teo Swee Lian Deputy Managing Director Financial Supervision D. Foo-Yap Siew Hong Assistant Managing Director Currency, Corporate Services & Human Resource / Special Projects Advisor to MD E. Andrew Khoo Assistant Managing Director Markets & Investment / External / MAS Academy F. Lee Boon Ngiap Assistant Managing Director Banking & Insurance
G. Lee Chuan Teck Assistant Managing Director Capital Markets H. Jacqueline Loh Assistant Managing Director Policy, Risk & Surveillance I. Low Kwok Mun Assistant Managing Director Finance, Information Technology and Risk J. Ng Nam Sin Assistant Managing Director Development K. Edward Robinson Assistant Managing Director Economic Policy
K A F
E I
MAS Annual Report 2012/2013 11
BOARD COMMITTEES*
The MAS Act provides that the Board of Directors shall be responsible for the policy and general administration of the affairs and business of MAS. The Board is assisted by the following committees: CHAIRMANS MEETING The Chairmans Meeting approves major changes to MAS supervisory policies and regulatory framework. It also approves major changes to policies and strategies relating to financial centre development and international and regional relations. The Chairmans Meeting comprises Tharman Shanmugaratnam (Chairman), Lim Hng Kiang, Heng Swee Keat, Lawrence Wong and Ravi Menon. MONETARY AND INVESTMENT POLICY MEETING The Monetary and Investment Policy Meeting deliberates and decides on issues relating to the formulation and implementation of monetary policy with the objective of maintaining price stability for sustainable economic growth. The Meeting also oversees the investment of MAS reserves. The Monetary and Investment Policy Meeting comprises Tharman Shanmugaratnam (Chairman), Lim Hng Kiang, Heng Swee Keat, Lawrence Wong and Ravi Menon. AUDIT COMMITTEE The Audit Committee provides an independent assessment of MAS internal controls and financial reporting process. The Committee also reviews the efforts of MAS internal and external auditors. The Audit Committee comprises Quek See Tiat (Chairman), Peter Ong and Tan Chorh Chuan. RISK COMMITTEE The Risk Committee provides oversight and guidance on the management of risks faced by MAS. The Committee oversees the MAS-wide risk management framework, and reviews MAS risk management policies and the processes for reporting of risks. The Risk Committee comprises Lim Chee Onn (Chairman), Tan Chorh Chuan and Ravi Menon.
* As at 1 June 2013
ORGANISATIONAL STRUCTURE*
Ravi Menon
Managing Director
FINANCIAL SUPERVISION Teo Swee Lian

Deputy Managing Director
CURRENCY Chung Wei Ken Executive Director HUMAN RESOURCE Ho Hern Shin Executive Director HUMAN RESOURCE PROJECTS Winnifred Chen Executive Director
Ong Chong Tee

Deputy Managing Director Monetary Policy and Investment / Financial Development
BANKING & INSURANCE Lee Boon Ngiap

Assistant Managing Director
Teo Swee Lian

Deputy Managing Director Financial Supervision
BANKING DEPARTMENT I Chua Kim Leng Executive Director BANKING DEPARTMENT II Wong Nai Seng Executive Director FINANCE, INFORMATION TECHNOLOGY & RISK MANAGEMENT Low Kwok Mun
MONETARY POLICY AND INVESTMENT / FINANCIAL DEVELOPMENT Ong Chong Tee

Deputy Managing Director
BANKING DEPARTMENT III Tai Boon Leong Executive Director INSURANCE Luz Foo Executive Director CAPITAL MARKETS Lee Chuan Teck
FINANCE Teo Kok Ming Executive Director INFORMATION TECHNOLOGY Lawrence Ang Executive Director RISK MANAGEMENT Daniel Wang Director
ECONOMIC POLICY Edward Robinson

ECONOMIC ANALYSIS Ng Bok Eng Executive Director ECONOMIC SURVEILLANCE & FORECASTING Celine Sia Executive Director MARKETS & INVESTMENT Andrew Khoo
CAPITAL MARKETS Loo Siew Yee Executive Director CAPITAL MARKETS INTERMEDIARIES Merlyn Ee Executive Director INVESTMENT INTERMEDIARIES Christopher Tan Director POLICY, RISK & SURVEILLANCE Jacqueline Loh
MANAGING DIRECTORS OFFICE SPECIAL PROJECTS ADVISOR TO MD Foo-Yap Siew Hong

MONETARY & DOMESTIC MARKETS MANAGEMENT Andrew Khoo

MAS ACADEMY Andrew Khoo

MACROECONOMIC SURVEILLANCE Lam San Ling Executive Director PRUDENTIAL POLICY Lim Tuang Lee Executive Director SPECIALIST RISK Wan Aik Chye Executive Director
RESERVE MANAGEMENT Yap Chuin Houi Executive Director DEVELOPMENT Ng Nam Sin
GENERAL COUNSELS OFFICE Ng Heng Fatt General Counsel EXTERNAL Bernard Wee Director INTERNAL AUDIT Timothy Ng Executive Director
FINANCIAL CENTRE DEVELOPMENT Leong Sing Chiong Executive Director FINANCIAL MARKETS STRATEGY Ng Yao Loong Executive Director
CORPORATE DEVELOPMENT CURRENCY, CORPORATE SERVICES & HUMAN RESOURCES Foo-Yap Siew Hong
STRATEGIC PLANNING AND COMMUNICATIONS Wong Nai Seng Executive Director SPECIAL DUTIES Chia Der Jiun Executive Director
CORPORATE SERVICES Bernard Yeo Executive Director
* As at 1 June 2013

THE ECONOMY GLOBAL, REGIONAL AND DOMESTIC A Year of Tepid Growth The year 2012 began on a cautiously optimistic note after a series of shocks reduced average GDP growth in Singapores key trading partners to 4.4% in 2011.1 However, a confluence of new uncertainties, including the escalation of the debt crisis in Greece, the threat of the fiscal cliff in the US, and fears of a sharp slowdown in China, caused the world economy to lose momentum again in mid-2012. As a result, external growth fell further to 3.9% for the yearthe slowest pace of expansion since the Global Financial Crisis. Nonetheless, robust policy responses by central banks in the advanced economies helped to stabilise financial conditions and triggered a rally in stock markets that carried over into early 2013. Most notably, the European Central Banks announcement of Outright Monetary Transactions (OMTs), promising unlimited support for vulnerable member states under certain pre-conditions, reduced the tail risk of a Euro zone exit. The US Federal Reserve followed up with a third round of quantitative easing measures, committing to purchase mortgagebacked securities until the labour market shows a substantial improvement. In November 2012, the newly-elected Japanese government announced ambitious plans to reflate the economy through generous fiscal stimuli and bold monetary easing, giving a further boost to confidence. The G3 Economies Underperformed as Fiscal Withdrawals Intensified The US economy expanded by 2.2% in 2012, with significant quarter-to-quarter volatility due to a combination of government spending cutbacks, natural disasters and rising uncertainty over fiscal policy. Private domestic demand turned out to be relatively resilient, supported by stronger residential investment and more moderate growth in consumption spending, compared to the previous year. However, falling federal and state expenditures subtracted more than one percentage point from overall GDP growth in Q4 2012. At the turn of 2013, a last-minute agreement by Congress helped to avert the fiscal cliff, quelling worries of a recession in H1 2013, although across-the-board spending cuts which were triggered by the budget sequester dampened confidence more recently. Despite this setback, US growth rebounded to 1.8% q-o-q SAAR in Q1 2013 from 0.4% in Q4 2012, as an ongoing labour market recovery and continued lift in house prices supported consumer spending. The Euro zone lapsed into a mild recession in 2012, with an output contraction of 0.5%. Economic activity fell sharply in the peripheral countries, as fiscal rectitude compounded a decline in private domestic demand. Growth in Germany also slowed as net exports, which bolstered economic performance in the first half of the year, became a drag on the economy in the second half. In H1 2012, fears of a possible Greek exit and the revelation of financial fragilities in Spain led to an increase in risk aversion. The subsequent debt settlement in Greece and banking sector bailout in Spain restored some calm to the markets, albeit at the expense of increased fiscal austerity going forward. Amid lingering concerns about the political situation in Italy and the repercussions of the Cyprus bailout, Euro zone GDP continued to contract, by 1.1% q-o-q SAAR in Q1 2013. The Japanese economy rebounded from the Great Eastern Earthquake with an expansion of 1.9% in 2012. After the spurt of public reconstruction
1 External GDP growth is weighted by country shares in Singapores NODX.
spending seen in Q1 2012, however, waning government stimulus measures pulled growth down for the rest of the year. Weak overseas demand, the strong yen and rising diplomatic tensions with China also contributed to a slump in exports and industrial production, culminating in a technical recession in Q3. However, since the commitment by the new administration to revive growth late last year, the yen has depreciated against the major currencies. The economy started 2013 on a solid footing, with growth accelerating to 4.1% q-o-q SAAR in Q1 2013, driven by robust consumer spending and higher net exports. Growth in Asia ex-Japan Slowed amid Sluggish External Demand Growth in the Asia ex-Japan economies slackened for the second consecutive year, falling to a postcrisis low of 5.1% in 2012 from 5.9% in 2011. The regions export performance last year was buffeted by sluggish demand from the advanced economies while an investment slowdown in China weighed on intra-regional trade. The Chinese economy expanded by 7.8% in 2012, the slowest pace in 13 years, as tight monetary policy and property restrictions curtailed real estate sales and construction, which in turn had a cascading effect on primary commodity exporters such as Indonesia and Malaysia. Nevertheless, resilient domestic demand took up the slack in exports and supported economic activity in much of the region. In fact, growth in the ASEAN-4 economies accelerated to 6.1% in 2012 from 4.5% in 2011, as an investment upswing, a step-up in public infrastructure projects and increased government transfers boosted spending. In the more externally-oriented NIEs, the knock-on effects of muted trade activity on corporate investment pulled GDP growth down to a three-year low in 2012. Towards the end of the year, however, these economies started to recover on the back of a turnaround in exports to China and a modest upturn in the global electronics cycle. Immediate Risks in Financial Markets have Receded Strong policy actions by central banks of key advanced economies have boosted financial
markets globally. From March 2012 to March 2013, the S&P 500 rose by 11.4%, the DJ Eurostoxx rose by 7.6%, the Nikkei 225 rose by 23.0%, while the MSCI Asia ex-Japan Index rose by a more moderate 4.5%. While these policy actions have buoyed markets and eased financing conditions considerably, they could also distort credit allocation and weaken incentives to repair balance sheets. It is thus important that advanced countries maintain focus on correcting longer-term financial and economic imbalances. Bank funding conditions in advanced economies have generally improved with policy actions to support funding markets, as well as continued progress in reforming financial systems. In Europe, there are nascent signs that credit conditions and peripheral bank funding have stabilised. However, further flare-ups in stressed sovereigns could again undermine confidence and impact financial market conditions. The banking systems of Asian countries have generally maintained sound capital buffers and funding profiles. With potentially slower economic growth ahead, increased leverage in some segments of corporate or household sectors and the possibility of some foreign investors pulling out of Asian asset markets, there is a need to be cautious and vigilant. Global Inflation was Subdued as Commodity Prices Eased Global inflation was subdued for much of 2012, as food and energy prices declined or registered smaller increases due to easing supply disruptions. This exerted downward pressure on consumer prices in the G3, reinforced by slowing growth and excess capacity. As a result, headline inflation in the G3 fell from 2.4% y-o-y in Q1 2012 to 1.7% in Q4. In Asia ex-Japan, inflation also declined markedly to 4% in 2012 from 5.6% in 2011, although core inflation was more persistent due to tight labour markets and high resource utilisation. In the first three months of 2013, headline inflation picked up again in Asia ex-Japan, as several economies were operating close to, or even above, their potential output levels and came up
against supply-side constraints. In response, some Asian countries increased infrastructure spending to relieve supply bottlenecks and implemented macroprudential measures to guard against excessive credit growth and asset bubbles. Singapore Experienced a Slowdown amid External Vulnerabilities Being a small and very open economy, Singapore was not immune to the global headwinds. The domestic economy grew by a modest 1.3% for the whole of 2012, down from 5.2% in the previous year. Having started the year strongly, activity weakened in Q2 and Q3 2012, alongside a pullback in global demand as tensions in the Euro zone mounted. However, prompt remedial action from the G3 central banks provided some reprieve to global financial markets, and Asia exJapan economies staged a broad-based rebound thereafter. Accordingly, the Singapore economy returned to growth in Q4 last year. (Chart 1) The lacklustre GDP outturn last year was largely on account of a downshift in manufacturing activity. In particular, Singapores electronics cluster recorded a double-digit contraction for the second consecutive year, amid sluggish external demand and a global supply overhang. The weakness in manufacturing, in turn, pulled down trade-related services. Growth in financial services likewise decelerated, as tepid investor interest led to a pullback in sentimentsensitive activities. Nonetheless, domestic demand provided some support to the economy. The
construction sector, for instance, turned in another year of robust growth, buoyed by a steady rollout of commercial and residential projects. Other domestic-facing sectors, such as real estate and professional services, also expanded at a firm pace. Going into 2013, the Singapore economy has maintained a modest upward momentum in Q1. The externally-reliant industries registered a setback due to a weaker performance in the pharmaceuticals and transport engineering segments, although domestic demand provided some support. Looking ahead, GDP growth should pick up over the course of this year amid an improving external environment. The domestic-oriented sectors are expected to remain the mainstay of growth, underpinned by ongoing supply-side expansions in transportation infrastructure and other major building works. Nonetheless, the recovery momentum is expected to be gradual and uneven, capped by the challenges in the advanced economies as well as resource constraints associated with domestic restructuring. The Singapore economy is therefore projected to expand by 13% this year. Over the medium term, growth is likely to reset to a more modest range compared to the 2000s. Resource constraints will be increasingly brought to bear as the population ages and foreign worker inflows ease. The current restructuring drive to orient the economy towards higher value-added activities and productivity-led growth is therefore critical.
Chart 1: Singapores GDP Growth

20 15 Per Cent 10 5 0 -5 YOY QOQ SAAR
2011
Q2
Q3
Q4
2012
Q2
Q3
Q4
2013 Q1
Domestic Factors Kept Inflation Elevated Singapores labour market remained tight in 2012, with the overall unemployment rate falling to 2%, the lowest since 1997. This was due to strong labour demand to meet capacity expansion in infrastructure and essential services, as well as a more restrictive foreign labour policy. While resident wage growth was dampened by the generally sluggish economic environment it slowed to 2.3% last year, from the 5.8% average in the preceding two years the decline in labour productivity led to a further build-up in business cost pressures. MAS Core Inflation, which excludes the costs of accommodation and private road transport, averaged 2.5% in 2012, up from 2.2% in 2011, as businesses continued to pass on some
of the cost increases to consumers. CPI-All Items inflation, while moderating from 5.2% in 2011, remained elevated at 4.6% in 2012, due to higher residential property rentals and car prices. These reflect persistent tightness in the housing rental market and smaller COE supply, respectively. (Chart 2) As the economy transits towards more sustainable, productivity-driven growth, the labour market will face continued constraints which will lead to further increases in domestic business costs. On the other hand, imported inflation will likely be subdued, given favourable supply conditions in the global commodity markets. Taking these factors into account, both MAS Core Inflation and CPI-All Items inflation will be lower in 2013 compared to last year.
Chart 2: Contribution to CPI-All Items Inflation

6 5 % Point Contribution 4 3 2 1 0 2000-09 -1
Accommodation CPI-All Items inflation Pte Rd Trpt ex-Petrol Services Food Oil Related Others
2010
2011
2012
MONETARY POLICY The Singapore economy saw a modest expansion in 2012, amid a softening in global economic activity. While the external-oriented sectors bore the brunt of the global downturn, domestic-
driven sectors, such as construction and related financing and real estate activities, remained broadly resilient. This kept the resource markets tight. Notably, the economy remained at full employment even as the level of output continued to coverge to its underlying potential.
Chart 3: Key Macroeconomic Variables and the Monetary Policy Stance
130 125 Index (Q1 2004=100) 120 115 110 105
Modest & Gradual Appreciation
Neutral Policy
Modest & Gradual Appreciation
Maintain Reduce Slope Re-centre
S$NEER
Re-centre 100 95 8 6 % of Potential GDP 4 2 0 -2 -4 -6 10 8 6 % YOY 4 CPI All Items Inflation 2 0 -2 20 Output Gap Increase Slope Slightly Maintain
Increase Slope Slightly & Widen Band
Increase Slope Slightly & Restore Narrower Band
2013 Q1: 4.0%
15
10 % YOY
5 Real GDP Growth 0 2013 Q1: 0.2%
-5
-10 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Q1
Against this backdrop, MAS tightened the monetary policy stance in April 2012 by increasing slightly the slope of the S$ nominal effective exchange rate (S$NEER) policy band, with no change to the level at which it was centred. This was a measured move to contain inflationary pressures, anchor inflation expectations and keep growth on a sustainable path while the economy restructures. The policy band was also restored to a narrower setting. Despite continued uncertainty about the outlook for the world economy, particularly with regard to Europe, the Singapore economy was projected to grow at a moderate pace in 2013. With persistent tightness in the labour market, this could exert some upward pressures on MAS Core Inflation. MAS thus maintained the April 2012 policy stance in the subsequent reviews in October 2012 and April 2013. Monetary policy in Singapore is formulated with the objective of promoting price stability as a basis for sustainable economic growth. Chart 3 traces the evolution of monetary policy, as indicated by movements in the S$NEER, against the backdrop of developments in growth and inflation. Since April 2010, MAS has adopted a modest and gradual appreciation path for the S$NEER policy band, which has had a restraining effect on the economy and prices. At the same time, the monetary policy stance has been calibrated to facilitate the ongoing economic restructuring aimed at raising productivity over the longer term. While MAS recognises that inflation could be temporarily higher, there is a need to guard against an entrenchment of inflationary pressures or build-up of inflation expectations during this period of transition. LIQUIDITY MANAGEMENT Enhancing Our Liquidity Management Framework In 2012, MAS continued to extend our network of cross-border collateral arrangements (CBCAs) in Asia. The CBCA with the Bank of Thailand (BOT) allows financial institutions in Singapore to pledge Thai Baht (THB) cash and THB-denominated sovereign and central bank securities to obtain Singapore dollar (SGD) liquidity at the MAS Standing Facility, and financial institutions in Thailand to obtain THB liquidity from BOTs liquidity
facility using SGD cash, sovereign bonds and central bank securities. This brings the total number of CBCAs that MAS has to seven. MAS also continued to expand the MAS Bills programme by issuing 12-week MAS Bills in July 2012 and raising outstanding issuance to S$37.2 billion in Financial Year 2011/12, up from S$18.0 billion in Financial Year 2010/11. PBC-MAS Bilateral Swap Arrangement In March 2013, MAS renewed and enhanced the bilateral currency swap arrangement with the Peoples Bank of China (PBC). The new arrangement doubles the size of the previous swap facility and enables both central banks to provide foreign currency liquidity to stabilise financial markets. Under the arrangement, up to RMB300 billion in Chinese Yuan (CNY) liquidity will be available to eligible financial institutions operating in Singapore, and up to S$60 billion in Singapore dollar liquidity will be available to eligible financial institutions operating in China. The arrangement will expire in 2016 and may be extended further by mutual agreement. The existing MAS CNY facility was subsequently enhanced to allow MAS to provide short-term liquidity for market stability, in addition to trade purposes. MACROPRUDENTIAL POLICIES Property Measures to Maintain a Stable and Sustainable Property Market MAS introduced two rounds of property market measures in 2012 and early 2013, to foster long term stability in the property market. In October 2012, MAS restricted the tenure of loans granted by financial institutions for the purchase of residential properties. We imposed a cap of 35 years on the tenure of housing loans granted by financial institutions. In addition, loans exceeding 30 years would face significantly tighter loanto-value (LTV) limits. For housing loans granted by financial institutions to non-individuals, the LTV limit was lowered from 50% to 40%. In January 2013, MAS lowered the LTV limits for property purchases by individuals with one
outstanding housing loan from 60% to 50%, and by individuals with two or more outstanding housing loans from 60% to 40%. Loans with longer tenure would face even tighter LTV limits. We also increased the minimum cash down payment requirement from 10% to 25% for property purchases by individuals with at least one outstanding housing loan. In addition, the LTV limit for housing loans to non-individuals was further lowered to 20%. To moderate the demand for HDB flats and instil greater financial prudence among buyers, MAS introduced a mortgage servicing ratio requirement of 30% on loans granted by financial institutions for the purchase of HDB flats. Financing Restrictions on Motor Vehicle Loans In February 2013, MAS introduced financing restrictions on motor vehicle loans granted by financial institutions. The tenure of motor vehicle loans was capped at five years while the loan-tovalue was limited to a maximum of 50% or 60% depending on the open market value of the motor vehicle. The restrictions were put in place to encourage financial prudence among consumers and moderate demand for motor vehicles. In consideration of feedback from industry participants and members of the public, an exemption was made for the physically disabled and their caregivers. A 60-day exemption was also granted to motor vehicles that were part of the used car industrys inventory and that were acquired prior to the introduction of financing restrictions. INDUSTRY STRESS TEST Industry Wide Stress Test / Financial Sector Assessment Programme Stress Test In 2012, MAS conducted an industry-wide stress test of financial institutions in Singapore. Banks were stress tested on solvency and liquidity risks, well ahead of Basel III requirements. On the whole, the key financial institutions were found to be resilient to the projected scenario, which included stressed conditions in the Eurozone, reflecting the generally small exposures that Singapores banking system had to the Euro zone. MAS is also working with the
financial sector on stress tests in preparation for the International Monetary Funds Financial Sector Assessment Programme (FSAP) in 2013. SINGAPORE GOVERNMENT SECURITIES (SGS) Developing the SGS market Introduction of 30-year SGS In April 2012, MAS marked a major milestone in the development of the SGD bond market by introducing the 30Y SGS. The instrument was well-received by the market and demand at primary auctions was high.The 30Y SGS enabled MAS to extend the SGS yield curve and provided an additional benchmark for the pricing of corporate bonds. It was also vital in satisfying the growing demand for longer-dated securities by banks, insurers and other financial institutions. CAPITAL MARKET DEVELOPMENT Broadening and Deepening Singapores Debt Capital Market MAS continues to strengthen the SGD debt market, implementing initiatives aimed at further improving the efficiency and liquidity of the SGD corporate debt market. First, the provision of swap liquidity to primary dealer banks handling SGD debt issuance for corporations is now fully operational. MAS will now be able to support swap transactions at market determined rates to minimise uncertainties in the bond pricing process. Second, MAS has been developing a facility to allow market makers to borrow SGD corporate bonds. The facility will improve liquidity in the secondary market and is expected to be operationally ready this year. Third, the price discovery initiative to improve transparency for SGD corporate bonds was successfully completed in mid 2012. Complementing this is an industry-led initiative to create a SGD corporate bond index which market participants could use as a benchmark for investment management. The bond index was launched in June 2013.
ROBUST, TRUSTED AND PURPOSEFUL FINANCIAL CENTRE
ROBUST, TRUSTED AND PURPOSEFUL FINANCIAL CENTRE

A ROBUST FINANCIAL CENTRE Strengthening Capital Requirements for Singapore-incorporated Banks MAS is committed to ensuring full, timely and consistent implementation of Basel III, issued by the Basel Committee on Banking Supervision (BCBS) to strengthen the resilience of the banking system. In September 2012, MAS issued a revised MAS Notice 637 to implement the Basel III capital framework in Singapore with effect from 1 January 2013. The revised Notice requires Singapore-incorporated banks to meet capital adequacy standards that are higher than the Basel capital standards, and also implements the Basel III capital reforms on raising the quality of capital, enhancing risk coverage, requiring capital buffers and monitoring of the leverage ratio. For Common Equity Tier 1 capital, Singapore-incorporated banks are required to maintain a ratio of at least 9%, inclusive of a capital conservation buffer requirement of 2.5%, compared to the Basel III requirement of 7%. This will further strengthen the ability of Singaporeincorporated banks to operate under stress conditions, and help safeguard financial stability. MAS amended MAS Notice 637 further in Q4 2012 to implement BCBS requirements issued in 2012 as part of Basel III on capital requirements for bank exposures to central counterparties and disclosure requirements on composition of capital. The capital requirements for bank exposures to central counterparties enhance incentives for banks to use central counterparties while ensuring that such exposures remain adequately capitalised. The disclosure requirements enhance the transparency and comparability of disclosures on the composition of regulatory capital. Our Basel III implementation efforts were validated by the BCBS under its Regulatory Consistency Assessment Programme from July 2012 to March 2013. In its assessment report of Singapore published in March 2013, the BCBS concluded that Singapore has put in place national regulations in accordance with the capital standards under the Basel framework, and assessed Singapore as being compliant. Enhancing Regulatory Capital Framework for Capital Market Services Licensees In April 2013, MAS issued revisions to the capital requirements for capital markets services licensees (CMSLs) to enhance the risk-sensitivity of the capital framework and strengthen the quality of capital of CMSLs. The revision followed a public consultation, and quantitative impact studies to assess the impact of the proposals on the industry. The enhanced capital requirements will further strengthen the ability of CMSLs to withstand the risks to which their business is subject. A Regulatory Framework for Financial Holding Companies In April 2013, the Financial Holding Companies Act (FHC Act) was enacted to extend MAS regulatory powers to non-operating holding companies that hold bank or insurance subsidiaries in Singapore. This new legislative initiative supports the established concept of group supervision. Under the FHC Act, MAS can designate an FHC for regulation where the FHC is an ultimate holding company of a financial group headquartered in Singapore or where doing so will strengthen its supervision of the Singapore bank or insurance subsidiary. The
regulations are aimed at mitigating intra-group contagion risk, preventing the multiple use of capital within the group, and limiting group concentration risk exposures. The FHC regulatory framework is in line with international regulatory developments, where there is growing recognition among international regulators of the role of FHCs and the need to include FHCs in their scope of group-wide supervision. Changes to the Qualifying Full Bank Programme As part of MAS efforts to encourage foreign banks to deepen their roots in Singapore while strengthening Singapores financial stability, MAS announced changes to the Qualifying Full Bank (QFB) programme. In June 2012, MAS announced its intention to grant a very small number of significantly rooted QFBs, an additional 25 places of business, of which up to 10 may be branches, as part of an overall package negotiated under free trade agreements (FTAs) with these QFBs home countries. In determining whether a QFB is significantly rooted, MAS will consider a range of quantitative and qualitative attributes that demonstrates the QFBs ability and willingness to support Singapores financial stability and development. Some of these attributes include whether the bank is locally incorporated with majority Singaporean/PRBoard representation, and what types of businesses are conducted by the locally incorporated entity; and if Singapore is one of the banks major markets, constituting a substantial part of group profits and assets. In addition, MAS will require existing QFBs that are important to the domestic market, as well as new QFBs offered under future FTAs, to locally incorporate, at minimum, their retail operations so as to enhance depositor protection. Enhance Supervision of Insurers MAS enhanced its insurance regulatory and supervisory framework on a number of fronts after several public consultations over the last few years. This included amendments to the Insurance Act (IA) to take into account global
supervisory and market developments since its last major amendment in 2004. The amendments enhanced MAS powers to achieve its supervisory objectives, improved the clarity of existing policy positions, and aligned the IA with other MASadministered Acts. In April 2013, MAS extended the Corporate Governance Regulations beyond the significant life insurers to all locally incorporated direct insurers and reinsurers. In addition, the Corporate Governance Guidelines, which were previously applicable to only locally incorporated direct insurers, were extended to the locally incorporated reinsurers and captives. To strengthen the standard of risk management amongst insurers, MAS issued a new Notice on Enterprise Risk Management (ERM) in April 2013. Under the ERM Notice, insurers are required to identify and manage the interdependencies between key risks, and to more effectively link these to their strategic management and capital planning within a framework guided by an explicit risk tolerance statement. A new Notice on Public Disclosure requirements was also issued in April 2013. This Notice requires insurers to publicly disclose more comprehensive information on a timely basis. This will help members of the public, including policyholders, to obtain a clear view of an insurers business activities, performance and financial position. MAS commenced a review of its Risk Based Capital (RBC) framework for insurance companies to keep pace with the evolving marketpractices and global regulatory developments. The review aims to improve the comprehensiveness of the types of risks covered and the risk sensitivity of the framework, as well as to redefine the solvency control levels. MAS is working in consultation with the industry to finalise the key components of the proposals by end 2013.
Box 1
Amendments to the Monetary Authority of Singapore Act MAS embarked on a review of its regulatory framework for financial institutions, with a view to strengthening the framework for financial stability and ensuring robust protection of depositors, insurance policy holders and consumers of financial services. As part of the review, MAS took into account the Financial Stability Boards principles on Key Attributes of Effective Resolution Regimes for Financial Institutions where relevant to Singapore. The Monetary Authority of Singapore Act (MAS Act) was then amended to enhance and expand MAS suite of powers for resolving distressed financial institutions. The amendments also strengthen the current framework for the issuance of MAS book-entry securities and regulation of primary dealers. Enhanced regulatory framework for resolution of financial institutions The Monetary Authority of Singapore (Amendment) Bill 2013 (the Bill), seeks to vest MAS with a broader range of regulatory options in dealing with failed financial institutions. The Bill extends resolution powers of MAS which previously exists only for banks and insurance companies, to over a wider range of financial institutions, including finance companies, merchant banks, operators and settlement institutions of designated payment systems, approved exchanges, and designated financial holding companies. These additional resolution powers mean that: (a) (b) (c) MAS will be able to issue directions to a non-regulated entity that is incorporated or established in Singapore, where the entity belongs to a group of companies of which a financial institution regulated by MAS is part of and is significant to the business of such a group; MAS may apply to the Court to claw back the salary, remuneration or benefits given to a director or executive officer under certain circumstances, for example, when the director or executive officer has failed to discharge his or her duties; and MAS may share information with a foreign resolution authority if the information is necessary in the resolution of a financial institution.
Framework for issuing MAS book-entry securities and regulating primary dealers The framework for the issuance of book-entry securities by MAS and the appointment of primary dealers enables MAS to issue securities in its name, and to purchase, repurchase, sell and redeem these securities as appropriate. These amendments serve to strengthen the legal and regulatory framework for MAS monetary policy operations and the market for MAS book-entry securities. The Bill was passed in Parliament in March 2013, and became effective in April 2013.
Monograph on Supervision of Financial Market Infrastructures in Singapore In January 2013, MAS published the Monograph on Supervision of Financial Market Infrastructures in Singapore. This monograph describes MAS approach in supervising Financial Market Infrastructures2 (FMIs) in Singapore to foster their safety and efficiency. It updates and replaces the 2004 monograph on MAS Roles and Responsibilities in Relation to Securities Clearing and Settlement Systems in Singapore. This monograph also explains MAS application of the Committee on Payment and Settlement Systems (CPSS) and the International Organization of Securities Commissions (IOSCO) Principles for FMIs (PFMI). The PFMI sets out international standards designed to ensure that the infrastructure supporting global financial markets is robust and well-placed to withstand financialshocks. It provides guidance on the identification, monitoring, mitigation and management of the full range of risks that arise in or are transmitted by FMIs. Technology Risk Management Notice and Guidelines In June 2013, MAS issued the Technology Risk Management Guidelines and Notice to strengthen technology risk management capabilities in financial institutions. The Guidelines were enhanced from the existing Internet Banking and Technology Risk Management Guidelines (IBTRM) to address existing and emerging technology trends as well as security concerns in the financial industry. The Notice defines a set of legal requirements relating to technology risk management for financial institutions. Under the Notice, financial institutions are required to maintain a high level of reliability, availability and recoverability of critical IT systems and to implement IT controls to protect customer information from unauthorised access or disclosure. In addition, financial institutions are required to report major system malfunctions and IT security incidents promptly to MAS.
Enhancing Corporate Governance Standards To enhance the corporate governance standards in listed companies, MAS accepted the recommendations of the Corporate Governance Council and issued the revised Code of Corporate Governance (Code) on 2 May 2012. The key changes to the Code were in the areas of director independence, board composition, director training, multiple directorships, alternate directors, remuneration practices and disclosures, risk management, as well as shareholder rights and roles. The revised Code took effect for listed companies in respect of annual reports for financial years commencing from 1 November 2012. Following the issuance of the revised Code of Corporate Governance, the Corporate Governance Council released its Risk Governance Guidance for Listed Boards (Guidance) on 10 May 2012. The Guidance is intended to provide key information on risk governance to all Board members. This includes factors which the Board should collectively consider when overseeing the companys risk management framework and policies, and the Boards and Managements respective responsibilities in managing the companys risks. MAS also sought to enhance corporate governance in banks by issuing MAS Notice 643 which details MAS requirements relating to banks transactions with their related parties. The requirements seek to minimise the risk of abuses arising from conflicts of interest, and to align banks procedures on related party transactions with international best practices. Among other things, MAS Notice 643 requires banks to ensure that every related party transaction is conducted free of conflicts of interest and on no more favourable terms than similar transactions with non-related parties under similar circumstances. Bank boards and management are also required to exercise adequate oversight and control over all related party transactions.
2 FMIs refer to systemically important payment systems, central counterparties, securities settlement systems, central depositories and trade repositories.
Develop and Implement a Regulatory Framework for OTC Derivatives MAS is working towards implementing the recommendations of the Financial Stability Board (FSB) on strengthening regulation of overthe-counter (OTC) derivatives. In February 2012, MAS consulted on policy proposals to: (a) mandate the reporting and clearing of OTC derivatives; (b) extend the current regulatory regimes for market operators, clearing facilities and capital market intermediaries to include OTC derivatives; and (c) introduce a new regulatory regime for trade repositories. MAS also sought public feedback on whether it is appropriate to require trading of standardised OTC derivative contracts on exchanges or electronic trading platforms at this stage, taking into account the nature of the derivatives markets in Singapore. MAS will implement the OTC regulations in phases. Amendments to the Securities and Futures Act (Cap. 289) for phase 1, which include (i) mandating the reporting and clearing of OTC derivatives; (ii) extending the current regulatory regimes for clearing facilities to include OTC derivatives and; (iii) introducing a new regulatory regime for trade repositories, were passed by the Singapore Parliament in November 2012. Mandatory reporting of OTC derivatives is expected to begin in H2 2013, and mandatory clearing to begin in H1 2014. MAS intends to implement fully the global OTC derivatives reform agenda, taking into account the characteristics of Singapores markets. We will continue to participate in and contribute actively at international discussions on OTC derivatives reforms, such as the FSB OTC Derivatives Working Group, OTC Derivatives Regulators Group, BCBS-IOSCO Working Group on Margin Requirements and the CPSS-IOSCO Working Group on access to trade repositories data.
Implementation of Enhanced Regulatory Regime for Fund Management Companies Following a series of policy and legislative consultations, MAS implemented the enhanced fund management regulatory regime on 7 August 2012. The enhanced regime aims to raise regulatory standards and supervisory oversight of the fund management industry. Smaller fund managers that were previously exempt as they serve restricted numbers of qualified investors now have to apply for registration or licensing and more than 400 of them had done so by February 2013. To qualify for a licence or registration, they have to meet admission criteria such as capital and competency requirements. In addition, enhanced business conduct requirements apply to all fund managers under the enhanced regime. To ensure a smooth transition to the enhanced regime, MAS conducted a series of industry briefings in August 2012 to familiarise the industry with the new requirements. MAS also launched a new Corporate E-Lodgment system to facilitate the admission process for registered and licensed fund management companies, and for the submission of certain ongoing regulatory returns. Offers and Prospectuses Electronic Repository and Access (OPERA) In April 2012, MAS began rolling out enhancements to our on-line database that hosted prospectuses for offers of shares, debentures, units in business trusts and collective investment schemes. The Offers and Prospectuses Electronic Repository and Access (OPERA) platform was progressively upgraded to facilitate the electronic lodgment of prospectuses as well as offer documents in respect of mergers and acquisitions under the Singapore Code on Take-overs and Mergers. OPERA now also allows users to submit on-line applications for registration of business trusts.
Payment System (MEPS+) MAS refreshed the system and application software used by the MAS Electronic Payment System (MEPS+), Singapores real-time gross settlement system in May 2012. In November 2012, MEPS+ was upgraded to support the Society for Worldwide Interbank Financial Telecommunications (SWIFT) new message format and new business requirements to achieve better risk management and efficiency. MEPS+ handled an average of 18,800 transactions (S$70 billion) per day in 2012, an increase of 8% compared with 2011. MAS conducts regular contingency exercises with the MEPS+ participants, CLS Bank and SWIFT to ensure that the national payment system remains stable and resilient, to minimise market disruption. A TRUSTED FINANCIAL CENTRE Rates Review In July 2012, MAS directed banks to comprehensively review their rate setting processes for the Singapore Interbank Offered Rate (SIBOR), Swap Offer Rate (SOR) and Non Deliverable Forward (NDF) foreign exchange contracts. This was in line with similar reviews conducted by regulatory authorities in other jurisdictions on key market interest rate benchmarks. Following the conclusion of the review, MAS took supervisory actions against twenty banks for deficiencies in the governance, risk management, internal controls, and surveillance systems relating to their involvement in benchmark submissions. These actions include imposing additional statutory reserves, and directing banks to adopt measures to address their deficiencies and conduct an independent review to ensure the robustness of their remedial measures. Separately, MAS issued a consultation paper on a proposed regulatory framework for financial benchmarks. The proposed framework took into account relevant international developments on financial benchmarks, including the reviews conducted by the Bank of International
Settlements (BIS) and International Organisation of Securities Commissions (IOSCO). The Association of Banks in Singapore (ABS) and the Singapore Foreign Exchange Markets Committee (SFEMC) had also submitted their recommendation to MAS on measures to strengthen the governance and design of benchmark rates setting processes in Singapore for SIBOR, SOR, and NDF foreign exchange contracts. Changes to the ABS benchmark rate setting processes will be rolled out progressively over the course of H2 2013. Strengthen Anti-Money Laundering / Countering the Financing of Terrorism Requirements for Financial Institutions Singapore participates actively in global efforts to combat money laundering, terrorism financing and proliferation financing. As a member of the Financial Action Task Force (FATF), Singapore is fully committed to enhancing our regulatory regime to be in line with the revised FATF Standards. Financial institutions operating in Singapore are required to comply with MAS requirements, which include the MAS Notice on the Prevention of Money Laundering and Countering the Financing of Terrorism (AML/ CFT). Financial institutions are required to identify and know their customers, including beneficial owners, to conduct regular account reviews, and to monitor and report any suspicious transactions. We will continue to work in partnership with the industry to protect our financial sector against threats from cross-border crimes. In line with the revised FATFs recommendations, Singapore will criminalise the laundering of proceeds from serious tax crimes from 1 July 2013. A public consultation exercise was carried out to gather industry views and feedback on the proposal. MAS has responded to the feedback received and has also issued further guidance to the industry to facilitate effective implementation of this new FATF requirement. In addition to meeting the existing international AML/CFT requirements on suspicious transactions reporting, MAS also issued new notices requiring financial institutions to report to MAS suspicious
activities and incidents of fraud where such activities/incidents are material to the safety, soundness or reputation of the financial institution. Financial institution board members are also required to attend training on AML/CFT. Enforcement of Anti-Money Laundering/ Countering the Financing of Terrorism Regulations Over the last three years, MAS conducted a total of 108 AML/CFT inspections covering banks, insurance companies, money changers, remittance agents, capital markets services licensees, licensed trust companies, licensed financial advisers and registered insurance brokers. MAS noted that most institutions had in place the necessary policies, procedures and controls, congruent to the nature, size and complexity of their activities, to combat money laundering and terrorism financing. In addition, the institutions had invested in systems and people over the years to strengthen their AML/CFT measures. There is, however, room for improvement in several areas. The frameworks and policies for the identification and classification of high-risk accounts, and the performance of enhanced due diligence measures for such accounts need to be strengthened. MAS also noted instances where the rigour with which customer due diligence measures were performed could be strengthened, such as the screening of customer names and the determination of customers source of wealth. Such inadequacies in the execution of controls hindered the effective application of customer due diligence measures necessary to gain a reasonable understanding of customers, the intended nature of business relations, and expected account activity. MAS takes a serious view of breaches of AML/CFT regulations and failure by financial institutions to institute a robust AML/CFT control framework. Sanctions are imposed on institutions for regulatory contraventions and deficiencies in AML/CFT measures. These include formal warnings, reprimands, restrictions on operations, financial penalties and revocation of licences. Over the last three years, MAS has issued a total of 47 warnings and reprimands,
restricted the operations of seven institutions, and imposed financial penalties on 22 institutions. MAS has also revoked or did not renew the licences of 13 money changers / remittance agents. MAS requires the senior management of financial institutions to set the right tone and foster a strong AML/CFT control culture to prevent Singapores financial system from being used to harbour or as a conduit for illegitimate funds. Industry Sound Practices to Further Safeguard Singapores Wealth Management Sector On 28 March 2013, the private banking industry in Singapore launched a set of sound practices. Its objective is to safeguard the industry from being used as a platform to harbour proceeds from serious tax crimes. It comes on the back of new FATF recommendations on the designation of serious tax offences as money laundering predicate offences. These sound practices set out standards for private banks to detect and deter funds where there is suspicion that they are proceeds from serious tax crimes. These include guidance on implementing client acceptance policies, transactions monitoring and performing critical reviews of existing client pools. A PURPOSEFUL FINANCIAL CENTRE Anchor and Grow the Core Industry Pillars of Singapores Financial Centre: Foreign Exchange and Derivatives Markets, Corporate Debt Market, Asian Dollar Market, Asset Management, Infrastructure Finance Foreign Exchange (FX) Singapores FX market registered slight growth with total average daily trading volume in October 2012 at US$361 billion according to the biannual Singapore Foreign Exchange Market Committee (SFEMC) survey results. This was a 2.6% increase from April 2012 volumes. Trading of listed financial and commodity derivatives on domestic platforms, such as Singapore Exchange (SGX), Singapore Mercantile Exchange (SMX) and Cleartrade Exchange, continued to register stable growth. In particular,
the number of futures and options traded on SGX in 2012 increased 16% y-o-y to hit a new high of 76 million contracts, boosted by record growth of its flagship China A50 futures contract. Developments in OTC Derivatives Markets Following global regulatory reforms of the OTC derivatives market, MAS has been working closely with the industry to respond to the new regulatory environment. In September 2012, the Singapore Foreign Exchange Market Committee (SFEMC) issued a public statement to commit to meet high standards for electronic execution and confirmation of OTC interest rate derivative transactions by 30 June 2013. This reflects the industrys commitment to increase the level of standardisation of the OTC derivatives market, and towards transparency and more effective risk management. In the aspect of OTC derivatives clearing, total clearing volume and product offering have increased over the past year. For commodities derivatives, SGX AsiaClear reported a healthy 77% y-o-y increase in total clearing volume for energy, freight and dry bulk-related derivatives in 2012. SGX AsiaClear continued to anchor itself as the leading clearing house globally for iron ore derivatives with the launch of iron ore options clearing in September 2012 and a record year of 109.7 million metric tonnes of iron ore swaps and options cleared. It also expanded its product offering with the introduction of a futures contract suite called AsiaClear Futures, providing customers the continuity to tap on the fast-growing liquidity pool in iron ore swapsand other Asian commodities. In OTC financial derivatives clearing, SGX Asiaclear continued to witness steady growth since its launch in November 2010. As at end of Q1 2013, SGX cleared over S$340 billion in notional value of SGD and USD Interest Rate swaps, as well as Asian FX Forwards. To help the region meet impending OTC derivatives trade reporting obligations, the Depository Trust & Clearing Corporation (DTCC)
opened its Asia Pacific global data centre and office headquartered in Singapore in December 2012. DTCC was selected by international industry associations as the preferred global trade repository across the asset classes. The Singapore-based data centre is DTCCs first in Asia and part of its global triangulated infrastructure designed to support DTCCs Global Trade Repository services. This development will contribute to increased transparency in the OTC derivatives market. Asset Management Based on the 2012 Singapore Asset Management Industry Survey, assets managed by fund managers in Singapore stood at S$1.63 trillion. Asset under management (AUM) grew by 21.5 % y-o-y as a result of strong inflows and higher market valuations. Approximately 80% of the AUM was sourced from outside Singapore and more than 70% of the total assets were invested in the Asia-Pacific region, reflecting Singapores role as an asset management hub serving both regional and international investors. Corporate Debt Market The Singapore corporate debt market was buoyant in 2012, encouraged by a low interest rate environment and investors seeking relative stability in the fixed income markets. Outstanding volumes grew by 14% y-o-y to S$231 billion as at end of 2012. Issuance activity was also at its highest since 2007, with S$134 billion of debt securities issued in all currencies during the year. In the Singapore Dollar (SGD) bond market, a record S$30.5 billion of bonds were issued, well surpassing the previous high of S$24.2 billion achieved in 2010. In addition, the weighted average maturity of SGD bond issuances in 2012 increased by to 12.9 years from 7.5 years in 2011. Singapore remains an attractive issuance venue for several foreign entities. In 2012, nonSingaporean firms accounted for 22% of all SGD debt issuances.
Islamic financial services continued to grow. The year also saw renewed interest in sukuk issuances in Singapore. Two SGD sukuk totalling S$130 million were issued in 2012 by local entities including the first convertible sukuk in Singapore. The first half of 2013 saw a further two sukuk issues amounting to S$100 million and the launch of a S$500 million multi-currency corporate sukuk programme by a local entity. Infrastructure Finance Infrastructure financing continues to be a key sector in Singapores financial markets in supporting regional growth and financing needs. Together with other government agencies, we are bringing together expertise from across the infrastructure value chain, from project developers to Engineering, Procurement and Construction (EPC) players and multilateral development banks, to leverage on Singapores status as a financial centre to facilitate investments into Asias immense infrastructural needs. For example, the World Banks investment arm, the International Finance Corporation (IFC), will be setting up in Singapore its first Asset Management Company (AMC) office outside Washington DC, to invest in infrastructure projects in emerging markets. The AMC manages the IFC Global Infrastructure Fund, which will invest equity into infrastructure projects on a commercial basis. In addition, national export credit agencies such as JBIC and KfW have set up offices in Singapore to serve corporates that wish to tap on infrastructure opportunities in the region. Insurance The non-life insurance industrys growth moderated in 2012, growing at 4.8% to $9.3 billion. This was due to a decline in reinsurance underwriting activity following the 2011 natural catastrophe events in Asia-Pacific. The 2011 events tested Singapores ability to handle the burden of claims in the aftermath of the major catastrophes. However the reinsurers responded strongly by recapitalising and even strengthening their capital position to handle the claims. The experience strengthened Singapores resilience, and also built up its reputation as a first responder to these major events in Asia. Concurrently, re/insurers also strengthened their capabilities on underwriting natural disasters risk by enhancing the quality of their data
and risk modelling through partnerships with research institutes such as Nanyang Technological Universitys Institute Catastrophe Risk Management (on Maritime Risk, Urban Risk), Asia Risk Centre (Agriculture Risk and Food Security Research); as well as commercial modelling agencies. Enhancing the RMB infrastructure in Singapore On 2 April 2013, PBC and MAS signed a Memorandum of Understanding (MOU) on RMB Business Cooperation, while PBC and Industrial and Commercial Bank of China (ICBC) Singapore branch signed a RMB clearing agreement to formalise the clearing arrangements. On 27 May 2013, ICBC Singapore commenced its RMB clearing services in Singapore. Having a RMB clearing bank in Singapore is a significant milestone for Singapore as it provides financial institutions in Singapore the opportunity to play a greater role in intermediating the growing trade and investment flows between China and the rest of the world. With the build-up of RMB liquidity in Singapore, a wider range of RMB products and services will be offered by financial institutions in Singapore to better meet the financing, investment and risk management needs of the market. MAS will continue to work with the industry and our partners to develop the broader RMB ecosystem, ensuring a sound and vibrant growth of this new market. Asian Dollar Market The Asian Dollar Market posted robust growth in 2012. Total foreign currency lending in Singapore increased by 7.4% y-o-y. In particular, non-bank loans to East Asia grew strongly at 8.3%, underpinned by economic performance in China and Hong Kong. Non-bank lending to ASEAN also grew at a healthy 5%. Going forward, we expect growth in the Asian Dollar Market to be sustained on the back of steady growth of the Asian region. With the launch of the offshore RMB market in Singapore in May 2013, the Asian Dollar Market is also well positioned to capture growing RMB flows in the region.
Promote Local Talent and Leadership Pipeline As Singapores financial centre remains open to global talent, MAS is making concerted efforts to put in place initiatives to develop a strong core of Singaporean financial sector professionals. This includes efforts to raise the competency of Singaporean professionals through training programmes, allowing Singaporeans to undertake and excel in roles in important growth segments. MAS will also be providing more scholarships to enable Singaporeans to develop specialist skills through post-graduate programmes in such areas as quantitative finance, risk management, actuarial science and specialty insurance. MAS will work closely with financial institutions to nurture Singaporeans for leadership roles, through training and different jobs and country exposures. To raise financial sector productivity, MAS will work with the industry to encourage review of work processes to enhance efficiencies in specific segments of financial activity. These would include developing shared infrastructure, promoting automation and exploiting data synergies.

COMMITTED TOWARDS INTERNATIONAL EFFORTS ON FINANCIAL STABILITY AND FINANCIAL REGULATORY REFORM International Engagements Promote Consolidated Supervision and Cooperation with Foreign Regulators In 2012, MAS hosted supervisory college meetings for the three Singapore banking groups and Great Eastern Holdings Limited. These college meetings provided a forum for MAS and host supervisors of these institutions to exchange views and assessments of the institutions cross-border activities. The discussions enhanced MAS supervisory oversight of these financial groups and helped foster closer ties with host supervisors in the cross-border supervision of the groups. In addition, MAS continues to participate in supervisory college meetings of international and regional banks and insurers as host supervisor. This allows MAS to cooperate more closely with the home supervisors of foreign banks and insurers and strengthen our understanding of developments in other parts of the group that may have an impact on the Singapore operations. Crisis Management Group Meetings MAS is a member of the Crisis Management Group (CMG) of six globally systemicallyimportant banks and continues to participate in the CMG meetings. The meetings facilitate information exchanges between home and host supervisors and the establishment of institutionspecific cross-border cooperation agreements to support recovery and resolution planning. This enhances preparedness and cross-border coordination for crisis management, including recovery and resolution planning, for these institutions. Islamic Financial Services Board MAS is a full member of the Islamic Financial Services Board (IFSB), a multilateral standard setting and developmental agency for the Islamic finance industry. We sit on the governing Council and are also represented on its Technical Committee (TC), the deputies-level decisionmaking body for the organisation. The TC oversees the work on standard setting and provides guidance to the IFSB Secretariat on Islamic finance developmental initiatives approved by the Council. MAS has supported and contributed to the work of the IFSB through our participation in the various standard setting Working Groups and Task Force, as well as helped to further raise industry awareness through the hosting of 6th IFSB Summit in 2009 and seminars on Takaful and Islamic Capital Market Development. In the continuation of these efforts, MAS hosted the 26th Meeting of the TC in Singapore in February 2012. Singapores Participation in the International Monetary Funds Financial Sector Assessment Programme The Financial Sector Assessment Programme (FSAP), which was established in 1999, is a comprehensive and in-depth external assessment of a countrys financial sector. The assessment contributes to a deeper understanding of the stability and resilience of the financial sector. As an international financial centre, Singapore is committed to undergoing periodic financial stability assessments. In 2013, MAS participated in an FSAP, conducted by the International Monetary Fund (IMF). The FSAP involved two onsite missions to Singapore for the standards and financial stability assessment. During the first mission,
the FSAP Assessors met with MAS and other government agencies, as well as financial sector industry players and industry associations, to study Singapores observance of newly revised international standards on banking, insurance and securities. The assessment process was rigorous and MAS benefited from the productive discussions with the FSAP Assessors. The second onsite mission will take place in H2 2013 covering an assessment of financial stability of the system, including stress tests. The mission will also cover Singapores observance of the new Principles for Financial Market Infrastructures. Strengthening the International Monetary Funds Resources
The International Monetary and Financial Committee (IMFC), chaired by Deputy Prime Minister and MAS Chairman Tharman Shanmugaratnam, together with the G20, undertook efforts to enhance the International Monetary Funds (IMF) resources for global crisis prevention and resolution in April 2012. These efforts by the international community strengthened the IMF resources by US$461 billion3, with the first batch of bilateral borrowing agreements signed by the October 2012 meeting of the IMFC. Singapore played a key role in this international effort by working closely with the IMF and its members, as well as the G20 to galvanise contributions at the G20 Los Cabos Leaders Summit in June 2012.
Singapore is Committed Toward International Efforts for Financial Regulatory Reform As a member of the main committees and multiple working groups of the Financial Stability Board (FSB), Basel Committee on Banking Supervision (BCBS), International Association of Insurance Supervisors (IAIS), International Organisation of Securities Commissions (IOSCO), and Committee on Payment and Settlement Systems (CPSS), MAS continues to contribute to the development and implementation of international regulatory standards and the enhancement of global financial stability. MAS co-chaired the BCBS Core Principles Group which delivered the revised Core Principles for Effective Banking Supervision in September 2012. The Core Principles are the global standard for sound prudential regulation and supervision of banks and banking system. The revisions incorporate key lessons from the last financial crisis to strengthen supervisory practices and risk management, with particular emphasis on a more forward-looking and effective risk-based approach to supervision. MAS also co-chairs the BCBS working group that analyses banks risk weighting of assets held in the banking book. This work is part of the BCBS Regulatory Consistency Assessment Programme to ensure consistent implementation of the Basel framework. In addition, we are a member of the BCBS Working Group on Liquidity that developed the final text of the revised Liquidity Coverage Ratio (LCR) in January 2013. The LCR is an essential element of the Basel III reforms to promote the short-term resilience of banks liquidity risk profiles and improve the banking sectors ability to absorb shocks arising from financial and economic stress. At the FSB, MAS chaired the FSB working group on Risk Governance that completed the thematic peer review on risk governance in February 2013 to take stock of risk governance practices at both national authorities and firms. The peer review identified sound practices and sets out recommendations that will help raise the bar on supervisory expectations for risk governance. MAS also participated actively
In October 2012, the IMFC expressed support for the strengthening of the IMFs surveillance framework through the adoption of a new Integrated Surveillance Decision, a Financial Surveillance Strategy and the launch of a pilot External Sector Report. The IMFC provided guidance to the Executive Board of the IMF in its comprehensive review of the quota formula, which was completed in January 2013. This review built on inputs from the IMFC Deputies, which is chaired by Singapore. At the April 2013 Meeting of the IMFC, the IMFC, among others, advanced discussions on nurturing a sustainable recovery in the world economy and on dealing with financial stability risks arising from large and volatile capital flows.
3 As of May 2013
in the discussions which help shape international regulatory proposals on resolving failing financial institutions, addressing the systemic and moral hazard risks associated with systemically important financial institutions, implementing over-thecounter derivatives reforms, as well as strengthening the oversight and regulation of shadow banking. MD, MAS has also been appointed Chair of the FSB Standing Committee on Standards Implementation (SCSI), and will serve a two-year term from 2013 to 2015. The SCSI is one of four FSB Standing Committees, and is tasked with ensuring comprehensive and rigorous monitoring of agreed G20/FSB financial reforms in consultation and coordination with relevant standard setters. Under MAS chairmanship, SCSI will coordinate and drive implementation monitoring efforts across key G20 initiatives, including OTC derivatives reforms, resolution regimes and shadow banking. Concluding an Inter-Governmental Agreement on the Foreign Account Tax Compliance Act The Foreign Account Tax Compliance Act (FATCA) is a United States (US) law which requires all financial institutions outside of the US to pass information about financial accounts held by US persons to the US Inland Revenue Service (US IRS) on a regular basis. Singapore will conclude with the United States a Model 1 Inter-Governmental Agreement (IGA), under which information is exchanged between Singapore and US agencies. The Model 1 IGA will help ease the compliance burden and facilitate financial institutions in Singapore to comply with FATCA.
Regional Engagements Strengthening Cooperative Ties with Fellow Regulators MAS organises and participates actively in various bilateral and regional events to strengthen cooperative ties with central banks and fellow regulators. For instance, MAS is an active member of the annual ASEAN Insurance Regulators Meeting (AIRM). MAS also chairs the ASEAN Capital Markets Forum (ACMF) and the Working Committee on Capital Market Development (WC-CMD). We work closely with ASEAN regulators and the private sector to promote the ASEAN Economic Community 2015 vision of strengthening and deepening regional capital markets. ACMF and the ASEAN Exchanges have made significant progress on initiatives to promote the integration of ASEAN capital markets. These include the launch of the ASEAN Trading Link, the implementation of the fully harmonised ASEAN Disclosure Standards, the implementation of a framework for expedited review of secondary listing applications, the development of a regulatory framework for cross-border offers of mutual funds, and the completion of a common regulatory model to facilitate the cross-border provision of supporting marketing services. The ASEAN Trading Link will benefit ASEAN investors who will have greater access to a broader and more diverse portfolio of stocks to invest in. To enhance the ASEAN Trading Link further, it will be supported by ongoing work in the area of clearing, settlement and depository linkages. As chair of the WC-CMD, MAS works with ASEAN counterparts to develop regional capital markets. Through 2012-2013, WC-CMD continues existing efforts, including updating the ASEAN Bond Market Development Scorecard, which serves as a useful benchmark for ASEAN finance and central bank officials to monitor the progress of ASEANs bond market development, openness and liquidity. The WC-CMD also identifies capacity building programmes and the exchange of views on best practices, in an effort to reduce market gaps as identified in the
Scorecard. Other key initiatives include enhancing ASEAN members understanding in the area of over-the-counter derivatives and a partnership with ACMF and ASEAN Secretariat on an independent study of regional bond market development initiatives. Executive Meeting of East Asia-Pacific Central Banks MAS hosted the 43rd Executive Meeting of East Asia-Pacific Central Banks (EMEAP) Deputies Meeting and all 11 EMEAP member central banks and monetary authorities participated in the meetings. Deputies were updated on the work plans and progress of the various EMEAP Working Groups (on Banking Supervision, Financial Markets, and Payment and Settlement Systems), as well as the IT Directors meeting. As the Deputy Chair of the EMEAP Monetary and Financial Stability Committee (MFSC), MAS also hosted the 12th EMEAP MFSC Workshop on 22 March 2013, which saw a useful exchange of views on important financial market developments and continued collaboration initiatives. Maintaining Strong Bilateral Relations MAS continues to maintain regular policy dialogues with fellow financial regulators. In the past year, MAS held high-level bilateral exchanges with the China Banking Regulatory Commission (CBRC), and the Authoriti Monetari Brunei Darussalam (AMBD). Issues discussed included macroeconomic policies, impact from the Euro zone crisis and international supervisory developments. MAS-AMBD Bilateral Meeting
18 and 19 January 2013, in Bandar Seri Begawan, Brunei Darussalam. The host delegation was led by AMBD Managing Director Dato Paduka Hj Mohd Rosli bin Hj Sabtu, while the MAS delegation was led by MAS Managing Director Ravi Menon. The discussion at the inaugural high-level bilateral meeting revolved around economic, monetary and financial developments, banking supervision and training, currency issues and payment and settlementsystems. Bilateral high-level meetings will enhance the already strong cooperative ties between MAS and AMBD, and provide a regular platform for both monetary authorities to discuss issues of mutual interest. Revision of the Chiang Mai Initiative Multilateralisation Agreement ASEAN+3 Finance Ministers and Central Bank Governors endorsed the revised Revision of the Chiang Mai Initiative Multilateralisation (CMIM) Agreement on 3 May 2013. The revised CMIM Agreement incorporates measures to strengthen the CMIM that was earlier agreed in May 20124. ASEAN+3 countries also agreed to transform the ASEAN+3 Macroeconomic Surveillance Office (AMRO), which carries out regional surveillance activities to support CMIM decision-making processes,to an international organisation. The transformation will enable AMRO to conduct macroeconomic and financial surveillance as an independent international organisation, contributing further to the regional financial stability along with the strengthened CMIM. MAS and the Singapore Ministry of Finance jointly provide close and ongoing host country support for AMRO. A Host Country Memorandum of Understanding (MOU) with AMRO was signed on 2 May 2013.

The MAS and host delegation
The inaugural high-level bilateral meeting between MAS and AMBD was held between
4 This includes: (i) doubling the total fund size to US$240 billion, (ii) introducing a crisis prevention facility, (iii) increasing the IMF-delinked portion to 30% in 2012 with a view to increasing it to 40% in 2014 subject to review should conditions warrant, and (iv) lengthening the maturity and supporting periods for both the IMF-linked and IMF-delinked portions of the CMIM.
Box 2
MAS Lecture Governor Agustin Carstens shared his views on the state of the world economy, crisis resolution strategy and capital flows to emerging markets with 350 guests from the regional central banks, senior representatives from the financial institutions, public sector officers, academics and representatives from the industry associations. Since its launch in March 2000, MAS Lecture has provided a platform for distinguished members of the international financial community to offer perspectives on significant economic and financial issues of the day. Previous speakers included William McDonough, former President of the Federal Reserve Bank of New York; Robert Rubin, former Chairman of the Executive Committee, Citigroup Inc and former US Treasury Secretary; Sir Howard Davis, former Executive Chairman of UK Financial Services Authority; Jean-Claude Trichet, President of the European Central Bank; Toshihiko Fukui, former Governor of the Bank of Japan and Dominique Strauss-Kahn, former Managing Director of the International Monetary Fund.

Mr Ravi Menon, MAS Managing Director, presenting a gift to Mr Agustin Carstens, Governor of the Banco de Mexico, at the MAS Lecture 2013. The gift is a unique fusion of calligraphy and wood carving, and depicts the Chinese character which means Treasure.


ENGAGING THE PUBLIC
Box 3
The Singapore Third Series Coins
On 25 June 2013, MAS issued a new circulation coin series. The Third Series coins mark Singapores progress as a nation. Coins are renewed, usually every 20 to 30 years, to update their designs using icons that the public can better identify with, and to incorporate new security features to stay ahead of counterfeiters. The Third Series coin designs feature national icons and landmarks of our nation, economy and society. The look and feel of the new coins were developed in consultation with key coin validatorsuppliers and special interest groups such as the Singapore Association for the Visually Handicapped. Feedback from focus groups was also considered.
All past series coins remain legal tender and the public can continue to use them for payment alongside the new coins. The new series coins are issued at all retail banks in Singapore and are accepted at their automated coin deposit machines. To facilitate a smooth transition and minimise public inconvenience, coin-operated machines at public venues such as the MRT/LRT stations have been calibrated to accept both existing and new series coins. MAS has also been working with businesses with coin-operated facilities such asvending machine operators and supermarkets to prepare them for the launch of the new coins. These coin-operated machines will be calibrated in phases due to technical and cost considerations.

Managing Dollars and Cents As at 31 March 2013, the gross and active currency in circulation were S$31.6 billion (Chart 4) and S$27.9 billion respectively. The gross currency in circulation increased 9.5% over the year, with S$50.8 billion worth of notes and coins issued to banks and S$48.2 billion returned for the financial year.
In January 2013, MAS launched an initiative to encourage the use of good-as-new S$2 notes during Lunar New Year. Good-as-new S$2 notes are clean and crisp notes that are retrieved immediately after the Lunar New Year. Substituting the use of new S$2 notes with good-as-new ones for hong bao reduces wastage and helps preserve the environment. Public response was very encouraging, with a take-up rate for good-as-new notes at about 11% of the total S$2 notes issued.
Chart 4: Gross Currency in Circulation

35 30 25 S$ Billion 20 15 10 5 0 2009 2010 2011 2012 2013
Gross Circulation 2009 2010 2011 2012 2013 (S$Billion) Notes Coins Total 21.05 1.12 22.17 22.65 1.15 23.80 24.74 1.20 25.94 27.58 1.25 28.83 30.27 1.29 31.56
Beside the Chinese Almanac, Native Orchids and National Day Celebration coins, MAS launched and issued the Giant Panda Commemorative Coins in September 2012 to mark the arrival of two giant pandas Kai Kai and Jia Jia, in Singapore. The coins also helped highlight the threat of extinction faced by giant pandas today and
the importance of wildlife conservation. The coins come in three different versions with a similar design concept featuring Kai Kai and Jia Jia in their natural habitat. The Silver Proof Colour Coin is in a unique oval shape, the first to be issued by MAS. Each version has a limited mintage of 10,000 pieces.
Giant Panda Commemorative Coins to mark the arrival of two giant pandas Kai Kai and Jia Jia, in Singapore.
MAS Website In June 2012, MAS launched our revamped website which incorporated feedback from a public stakeholders engagement exercise. The new website also took into account recent technological developments and has an improved look and feel. The enhanced accessibility and navigability of the new website has received positive feedback from users who find greater ease in accessing information from MAS website through various smartphone and tablet devices. GENESYS To enhance MAS responsiveness to public enquiries and improve staff productivity, a General Enquiries System (GENESYS) was launched in November 2012. GENESYS allows MAS to manage all public queries and feedback, received via multiple channels such as emails, letters or feedback forms on a common platform. All correspondences pertaining to a public query are centrally managed and tracked, ensuring that MAS adheres to its service standard when replying to the members of the public who have written in. As a central repository for all queries received by MAS, the system provides MAS with greater insights into the areas of interest to the general public and the profile of the enquirers seeking information from MAS. PROTECTING CONSUMERS Enhancing Credit Cards and Unsecured Credit Rules On 21 December 2012, MAS issued a consultation paper on proposed changes to credit cards and unsecured credit rules. The changes were aimed at improving financial institutions lending and disclosure practices, empowering individuals to make better borrowing decisions, and helping individuals at risk of credit problems avoid getting into greater debt. MAS is fine-tuning the proposed rule changes in view of the feedback received, and will issue the revised rules in the second half of 2013.
Enhancing Regulatory Regime to Raise Market Conduct Standards and Safeguarding Interests of Retail Investors and Public Following the review of its regulatory regime governing the sale and marketing of listed and unlisted investment products in 2009 and 2010, MAS has made significant enhancements to its regulatory regime to raise market conduct standards and protect the interests of retail investors. These include implementing measures aimedat promoting more effective disclosure for retail investment products, and introducing requirements for intermediaries to formally assess a retail customers investment knowledge and experience before selling certain more complex investment products (termed Specified Investment Products or SIPs) to the customer. To give legal effect to measures that require legislative changes, the Securities and Futures (Amendment) Act 2012 and Financial Advisers (Amendment) Act 2012 were passed by Parliament in November 2012. To ensure the continued relevance and effectiveness of the requirements, as well as in response to public feedback, MAS refined the list of complex investment products that are subject to additional safeguards in December 2012. Intermediaries are also required to furnish a Risk Warning Statement as prescribed by MAS to all retail investors before allowing them to transact in an overseas-listed investment product for the first time on or after 28 February 2013. This is to ensure that investors are adequately informed of the risks involved in trading overseas-listed investment products. MAS will continue to monitor our regulatory framework to facilitate the growth of the capital markets while ensuring that appropriate safeguards are in place to protect the investing publics interests. Mystery Shopping Survey MAS engaged an external consultant to conduct a mystery shopping survey and released the
results of the survey on 6 July 2012. The survey focused on the financial advisory (FA) industrys implementation of MAS Guidelines on Fair Dealing, pertaining to the quality and suitability of advice as well as the adequacy of information disclosure. The survey involved 126 mystery shoppers making 500 visits to 11 banks and four insurance companies to seek financial advice from their representatives. A panel of industry practitioners was engaged by MAS to assess the suitability of the products recommended to the mystery shoppers, based on the shoppers personal profile, their experience during the advisory process, and the sales materials obtained from the financial institutions. The survey found that: Fact-find was generally carried out but the extent of information collected was inadequate. This may impede the representatives ability to make suitable recommendations. Basic product information was disclosed but other pertinent information such as risk
factors, amount and frequency of fees and charges, as well as free-look period were omitted. Inadequate product disclosures may result in consumers making poor investment decisions due to a lack of understanding of the product features and risks. Almost a third of the product recommendations were unsuitable. In many cases, the products recommended did not match the shoppers financial objectives or investment horizon. The survey results suggest that the FA industry has significant room for improvement and the findings were considered by the Financial Advisory Industry Review (FAIR) Panel, in the formulation of its recommendations. MAS has shared the survey findings of the individual institutions with their respective senior management and the overall industry results with the Association of Banks in Singapore (ABS) and the Life Insurance Association, Singapore (LIA). ABS and LIA have committed to working with MAS to conduct more mystery shopping surveys of their members.
Box 4
Raising the Bar for the Financial Advisory Industry
On 26 March 2012, MAS announced the commencement of the Financial Advisory Industry Review or FAIR. The aim of the review was to raise the standards of practice in the financial advisory (FA) industry, and to improve the efficiency in the distribution of life insurance and investment products in Singapore. The review focused on the following five key thrusts : raising the competence of FA representatives; raising the quality of FA firms; making financial advising a dedicated service; lowering distribution costs by enhancing market efficiency; and promoting a culture of fair dealing.
FAIR adopted a consultative approach so as to ensure that the recommendations were balanced and took into account the interests of all affected constituents and stakeholders. On 2 April 2012, a 14-member FAIR Panel chaired by MAS and comprising representatives from the industry associations, consumer and investor bodies, academia, and media, was formed to deliberate and propose recommendations on the five FAIR thrusts. As part of the FAIR process, MAS solicited and received more than 1,300 feedback responses from the public and industry practitioners on ways to improve the FA industry. An external consultant was also appointed to conduct a comparative study of the FA industry in Singapore with that of other jurisdictions to ensure that FAIR took into account international developments and best practices. The feedback responses and results of the comparative study were considered by the FAIR Panel in its deliberations. On 16 January 2013, the FAIR Panel announced its recommendations. There were a total of 28 recommendations made under the five FAIR thrusts. The key recommendations for each thrust are as follows: (a) raise the minimum academic qualification for new FA representatives from 4 GCE O level credits to a full GCE A level, International Baccalaureate qualification, or a diploma awarded by the polytechnics in Singapore, or the equivalent. This is to ensure that FA representatives are able to meet the needs of a more well educated Singapore population in an increasingly complex financial environment;
(b) raise the operating requirements for licensed FA firms to improve the quality of management and to ensure that these firms have adequate capital; (c) impose restrictions on the conduct of non-financial advisory activities by FA firms and representatives, as such activities could pose conflicts of interest and lead to neglect of their FA role; (d) require insurers to offer basic insurance products through a direct channel, so as to cater to certain underserved customer segments and help alleviate the state of underinsurance in Singapore; and (e) require FA firms to remunerate their representatives using the balanced scorecard approach, to supplement the current volume-based remuneration model with qualitative factors that promote fair dealing with customers. On 4 June 2013, MAS concluded a three-month public consultation process to seek comments on the recommendations of the FAIR Panel. MAS will study all the feedback received carefully before finalising any policy position, and will give the industry sufficient lead time to implement any new rules or regulations arising from FAIR.
Enhancing Market Conduct Between April 2012 and March 2013, MAS published a total of 56 formal regulatory and enforcement actions against companies and individuals for market conduct breaches. These actions included reprimands, composition of fines, imposition of civil penalties, and issuance of prohibition orders. Over this period, MAS also took other regulatory and administrative actions in another 210 cases. EDUCATING CONSUMERS MoneySENSE MoneySENSE employed a variety of platforms to engage and help equip consumers from different walks of life with the necessary knowledge and skills to make informed financial decisions. While MoneySENSE educational efforts continued to emphasise building awareness and equipping consumers with foundational skills in budgeting, setting goals, managing savings and debt, buying suitable insurance and basic investing, educational initiatives were also undertaken to address thematic concerns or gaps in awareness vis-a-vis certain financial products, schemes and developments in the market. Media Outreach To extend our media outreach efforts beyond the English speaking population, we commissioned another series of the Mind Your Money TV Programme on Channel 8 in March 2013 to reach out to the Mandarin speaking population. Presented in an edutainment style format, the four-episode series featured tongue-in-cheek skits reflecting themes and views on money commonly shared by consumers, and interviews with experts on their opinions on topics ranging from buying a home, managing money, insurance and retirement planning. The series was well received with approximately 964,000 viewers. Running parallel with the TV programme, a radio campaign was aired in the four official languages to disseminate a similar range of financial education messages. MoneySENSE radio campaign reached
out to an estimated 1.5 million listeners via live interview or in the form of radio capsules. MoneySENSE also sponsored 10 educational articles on new and common (but hard to understand) financial products and schemes in the Sunday Times and weekend editions of Business Times and Lianhe Zaobao. The choice of topics was mainly determined by feedback and other indications that consumers could benefit from learning more in these areas. Outreach Through Other Platforms The My Money seminars, a collaboration with the Association of Banks in Singapore, Securities Investors Association (Singapore), Singapore Management University Sim Kee Boon Institute for Financial Economics and National Trades Union Congress, continued to be a popular platform to highlight salient features and risks of common financial products. Approximately 3,200 participants attended the seminars which were made available in both English and Mandarin. MoneySENSE continued to support the promotion of financial education to schools and students. For the lower primary level, we partnered the Association of Banks in Singapore and brought Save and Spend Wisely skits to the students. For the wider student segments, MoneySENSE continued to improve financial literacy through vendor-run programmes and competitions.
Box 5
MoneySENSE - Singapore Polytechnic Institute for Financial Literacy
A highlight of the year was the launch of the MoneySENSE - Singapore Polytechnic Institute for Financial Literacy on 16 July 2012. Its launch was a significant development in the MoneySENSE financial education agenda and facilitates the delivery of financial education to the public in a regular and structured manner. The Institute aims to build core financial capabilities across a broad spectrum of the Singapore population. The core financial capabilities are (a) understanding money and having numeracy skills to be able to evaluate costs and benefits;
(b) understanding yourself, your rights and responsibilities; (c) managing money to live within ones means; (d) planning ahead for your financial needs and goals; and (e) selecting financial products suitable for you. Initially the Institute will focus on delivering financial education to working adults. To improve access for working adults, the Institute conducts free talks and workshops in workplaces. The Institute is also working with community organisations to develop and conduct customised programmes for Singaporeans in lower income groups.
MoneySENSE Website Another major initiative was the revamp of the MoneySENSE website. The new website was launched in June 2012 and features better navigation and access to content. Much of the content was revised and rewritten in simple language. There are now guides to help consumers deal with financial concerns at particular life events or where there are major decisions to be made, like getting married, buying a home or starting a family. Consumers can also learn more about the various aspects of financial management such as
budgeting and saving, managing debt, financial planning and goal setting, buying insurance and basic investing. There are also guides on banking and payment services, credit facilities and loans, and on the more commonly available insurance and investment products. A budget template and financial calculators are also available to aid consumers in managing their money. We encourage consumers to visit the MoneySENSE website (www.moneysense.gov.sg) to equip themselves with useful and objective financial information.
ENGAGING THE INDUSTRY MAS Streamlines and Enhances Requirements on Disclosure of Interests in Listed Entities In November 2012, MAS introduced a new disclosure of interests (DOI) regulatory regime to streamline and enhance the existing DOI requirements in listed entities by directors and substantial shareholders. Key changes include simplifying the notification process by removing the requirement for directors and substantial shareholders of a listed entity to separately notify the SGX of their interests or changes in interests in the listed entity, extending the DOI requirements to foreign corporations with a primary listing on SGX, making it a legal requirement for listed entities to announce the information within one business day, and introducing stiffer penalties for flagrant breaches. Taking into account public feedback, MAS introduced new electronic notification forms for use by reporting persons and worked with the SGX to re-design the announcement template such that listed entities can attach the forms directly for immediate dissemination. This removes the need for manual entries by listed entities and improves the efficiency of the reporting process. In conjunction with the introduction of the new DOI regime, MAS has also launched a new internal IT system, the Regulatory Actions for Interest Notification Breaches and Offences Work System (RAINBOWS), to facilitate the processing of breaches. RAINBOWS also serves as a repository for all notifications of interests announced via SGXNet, and regulatory actions taken by MAS for breaches. Enhancing Physical Security of the Financial Industry MAS continued to work with the financial industry through the Financial District Security Programme (FDSP) to enhance their physical security, crime prevention and business resilience measures. FDSP members assessed their financial institutions against the baseline physical security guidelines developed in 2011. A selfassessment checklist was also developed to
facilitate the industrys understanding and adoption of these guidelines. To strengthen crisis coordination and response, members validated the contingency preparedness and response framework as part of an evacuation exercise at the Marina Bay Financial Centre. Members also engaged critical service providers to understand their resilience and business continuity plans, so that continuity planning and responses by financial institutions and service providers can be enhanced. Working with Key Stakeholders MAS holds regular dialogues with industry associations such as the General Insurance Association of Singapore (GIA), Life Insurance Association Singapore (LIA), Singapore Reinsurers Association (SRA), the Institute of Certified Public Accountants Singapore (ICPAS) and the Singapore Actuarial Society (SAS). These dialogues help us to better understand the risks and challenges facing the industry, and provides a good foundation for MAS and the industry to collectively work toward good supervisory outcomes and financial stability. Since 2011, MAS has supported an industry initiative to foster reinsurance contract certainty. Comprising industry partners such as the Reinsurance Brokers Association of Singapore, Lloyds Asia, SRA and the GIA, the Contract Certainty Working Group (CCWG) finalised a set of best practices to achieve reinsurance contract certainty in February 2013. The CCWG will continue to work towards embedding these agreed best practices amongst industry players. Insurance Directors Programme The board of directors of a financial institution is responsible for adequate risk oversight of the organisations business activities, including establishing effective processes and controls to manage risks, and ensuring that these processes comply with regulatory requirements. In our efforts to reinforce the responsibilities of boards of institutions across the financial sector, MAS in consultation with directors of insurance companies, organised an Insurance Directors
Programme for directors of four significant insurance companies and one holding company. The series of seminars focused on effective board governance and entrepreneur risk management for the insurance sector. Speakers included former regulators from developed jurisdictions. Partnership with Academia Since 2009, MAS has sponsored the Term Professorship in Economics and Finance at the National University of Singapore (NUS). The professorship programme seeks to enhance Singapores financial and economic research infrastructure and contribute to a vibrant research community and culture at local universities. In December 2012, Professor Randall Morck (Stephen A. Jarislowsky Distinguished Chair in Finance and University Professor, University of Alberta) visited MAS and NUS as the fourth Term Professor. An expert in financing structures, especially in Japan and China, Professor Morck delivered a public lecture titled Japanese Lessons, which explored how the zaibatsu5 helped jump-start Japans first phase of industrial development at the turn of the 20th century. He also shared his insights on corporate finance with MAS Senior Management, MAS staff, and the University. MAS hosted other academics under its Eminent Visitor Programme during the year. In addition to meeting with MAS Senior Management, Eminent Visitors to the Economic Policy Group usually conduct in-house seminars, lectures and discussion sessions with MAS staff, and contribute an article to the Macroeconomic Review. Professor Eric van Wincoop (University of Virginia) and Professor Philippe Bacchetta (Lausanne University) visited in June and July 2012, respectively. During their visits, they delivered seminars on their joint research work on global financial contagion and exchange rates, and co-authored a Special Feature on self-fulfilling panics for the October 2012 issue of the Macroeconomic Review. The Group also hosted Professor Shang-Jin Wei (Columbia University) in February/March 2013 and consulted with Professor Ilian Mihov (INSEAD Singapore). For the April 2013 Review,
Professor Wei wrote about the competitive saving motive. Following research partially sponsored by the MAS, Professor Mihov contributed a Special Feature that developed a New Keynesian small open economy model and applied it to Singapores economic and policy settings. This modelling approach has now become standard in the literature and it was instructive to have Singapores monetary policy framework formally characterised in this way. His findings suggest that the adoption of an exchange rate-based monetary policy rule results in an improvement in social welfare associated with a reduction in the volatility of key macroeconomic variables, such as inflation and output, when compared with an interest rate policy rule. Further extensions of this model will allow the investigation of other specific issues of policy interest and serve as a useful complement to MAS existing suite of models.
5 Zaibatsu refers to Japanese conglomerates with large, pyramidal groups of listed firms under the control of families or groups of entrepreneurs.

BUILDING HIGH PERFORMANCE TEAMS AND A STRONG MAS FAMILY MAS strength lies in our people. Guided by the shared values of integrity, commitment, enterprise and teamwork, MAS staff continued to demonstrate great dedication in the past year to the mission of maintaining stability, soundness and vibrancy in our financial sector. To develop our staffs potential to the fullest and to build high performance teams throughout the organisation, we continue to nurture our staffs expertise and leadership skills through learning and various developmental programmes. Expertise and Leadership Development General and Functional Training The MAS Academy offers a comprehensive suite of programmes, covering functional, general development and leadership courses, designed to add depth and breadth to our staffs knowledge and skills. All new entry level officers go through a structured broad-based learning programme that equips them with basic competencies in MAS key functions. For senior or experienced staff, there are numerous intermediate to advanced level functional training, as well as coaching programmes available. Regional and External Programmes Four regional programmes were offered to regional supervisors last year an IT Supervision Workshop, the MAS-Toronto Centre Regional Leadership Programme for Securities Regulators, and two Banking Supervisor Training Programmes. MAS continues to support SEACEN in its training efforts, including the hosting of two SEACEN seminars and providing resource speakers to SEACEN courses. Leadership Programmes In the past year, new cohorts of emerging leaders participated in our milestone programmes the Young Professionals Programme and the People Leadership Programme. Apart from classroom learning, participants also had the opportunity to engage in experiential learning activities as well as peer learning and coaching. Through a series of interrelated modules on topics such as personal mastery, team effectiveness, influencing skills and coaching, these programmes seek to build and hone leadership skills among young professionals and leaders in MAS. To encourage continuous learning in MAS, a coaching framework has been put in place for supervisors to equip themselves with skills to coach their staff and teams. The objective is to forge engaging relationships, improve work performance and strengthen employee engagement. About 200 of our supervisors have undergone such training, and two batches of leaders have also been specially trained as internal coaches under a Workplace Coach Certification Programme, to provide professional coaching to our staff. MAS Peer Groups Peer Groups are communities of practice that conduct learning and sharing on developments and trends in specialised subject areas. During the year, MAS Peer Groups organised various activities to help staff keep abreast of developments and trends in a number of areas. For example, the Islamic Finance Peer Group conducted a sharing session on the latest development and initiatives in Islamic Finance, including lessons learnt from an overseas IFSB-FIS seminar on
Liquidity Risk Management and Stress Testing Standards. A new Peer Group, Futures Thinking, was set up in 2012, to focus on scenario planning. Through the culture of sharing, Peer Groups have helped update MAS staff on the latest developments in various specialist subject areas, and develop deep technical knowledge and competencies in many areas. Attachment and Secondment
Survey (EES) since 2008, which elicited an encouraging 92% participation rate. The EES was followed by a series of engagement workshops and discussions involving all MAS staff. This EES process highlighted areas both within teams and throughout the organisation where staff engagement can be improved. This consequently allows us to improve staff commitment, productivity and the quality of our work. Recognition of Staff
In addition to the broad training programmes that we provide to all staff, some of our officers were also sent to leading financial institutions and foreign regulatory bodies for short-term attachments to acquire technical expertise and industry knowledge. MAS also seconds officers to supranational organisations, where they hold key positions within these organisations for a defined period. These experiences provided our officers the opportunity to keep abreast of evolving trends and developments in the financial sector, and contribute to the process of shaping international developments and standards. Engaging Staff MAS continued efforts to engage our staff by conducting our third Employee Engagement
The Service Appreciation Award (SAA) recognises and celebrates the loyalty and contributions of our dedicated staff. The awards ceremony was held on 7 August 2012. In all, 177 staff received the SAA for service in MAS ranging from five years to 40 years. Seven staff received the 40year award. One recipient, Spencer Hsu from the Financial Centre Development Department, remarked I am delighted to receive the 5-year SAA as it marks a milestone in my time with the organisation. My first 5 years in MAS has been a great time of learning, self-discovery and making new friends, and it was particularly heartening to see my fellow trainee officers receiving the award together as well. I look forward to further opportunities ahead as I continue to develop within the organisation.
Box 6
MAS An Employer of Choice MAS continued to be featured as an employer of choice in various surveys. In the 2012 Graduates to Industry (GTI) Global 100 series conducted with a research institution in Europe, MAS came in 19th place among Singapores top 100 employers of choice. The 2012 Universum IDEAL Employer Survey saw MAS rated as one of the top 10 employers that business students considered to be ideal to work for. MAS was the 6th most favoured government employer of choice in the 2012 Jobs Central Employer of Choice survey. Conducted among undergraduates and fresh graduates, the surveys reveal how attractive an employer is to young entrants to the workforce.
National Day Awards This year, 15 MAS staff were honoured for their contributions and service to the nation. Among the recipients were Deputy Managing Director Teo Swee Lian, who was conferred the Public Administration (Gold Bar) Medal, as well as Assistant Managing Director Andrew Khoo and Executive Director Leong Sing Chiong, who each received the Public Administration (Silver) Medal. We extend our heartiest congratulations to all our National Day Award recipients. FOSTERING CLOSER TIES MAS Dinner & Dance 2012
Inter-Central Bank Games 2012
Inter-Central Bank Games 2012 Mini Cross Country
The ICBG contingent posing gangnam style at the picturesque Candi Borobodur The 36th Inter-Central Bank Games (ICBG) was
It was a night of glitz and glamour on 6 July 2012 at the Swissotel Ballroom. The theme of the Dinner & Dance was MASmerise and staff were certainly dressed up to the nines to mesmerise one another. One of the highlights was the staff performance showcase. The audience were thrilled to see a different side of their fellow colleagues displaying their hidden talents in singing, dancing and music. Besides the staff performances, guests were entertained by a Michael Jackson impersonator who showed off some slick moves such as the famous moonwalk. The emcee for the night also worked the crowd with his witty jokes and dance moves. The atmosphere was light-hearted with plenty of laughter shared among colleagues throughout the night.
held in Yogyakarta, Indonesia. MAS athletes took part in the games which was held from 28 September to 1 October 2012. The five competing sports included fishing, 9-ball pool, running, mens basketball and ladies futsal. MAS performed above expectations and produced one of our best performances in history. The fishing team clinched the top spot while both the 9-ball pool team and the running team bagged the silver awards. Mens basketball and ladies futsal came in third and fourth placing respectively. Despite the outstanding achievement, what we valued more were the friendships we have forged both with our colleagues and with our regional counterparts. ChristMAS 2012 The Christmas food distribution to the visually impaired as well as to households receiving assistance from Government-funded ComCare programmes, was a heart-warming exercise. Staff pledged and donated food items like rice, cooking oil, canned food, biscuits, sachets of
instant beverage, sugar/salt and condiments. Volunteers also stepped forward to deliver to different parts of Singapore the gift packages directly to the 24 families of the visually impaired, registered with the Singapore Association for the Visually Handicapped. A sizable donation of food items were also transferred to the Boys Brigades headquarters to beef up their collection under the Boys Brigade Share-a-Gift programme. This could only be made possible with all who volunteered their money, time, sweat and trolleys to make this event a meaningful one for the less privileged in our society during the Christmas season. RAISING PRODUCTIVITY As part of our on-going efforts to improve work processes and enhance efficiency within the MAS workplace, we have implemented an integrated Human Resource, Finance and Procurement System - the MAS Employee Resource Integration Tool (MERIT). MERIT was launched in phases from late 2012 to March 2013, integrating Human Resource, Finance and Corporate Services Departments key work streams and processes to facilitate greater efficiency and approval controls. By having consistent and real time information more readily available, MERIT also empowered MAS managers with better analysis and decision making capabilities in areas such as purchase approvals, staff resource planning, and in the management of training and career development plans of MAS staff. MERIT also provides staff with day-to-day convenience, such as a onestop self-service portal to carry out a variety of transactions, including viewing and updating personal information, managing training needs, applying leave and submitting claims. Another example of the MAS-wide initiative to enhance the IT environment and tools for effective collaboration and sharing of information amongst staff is the MAS Integrated Collaborative Environment (MICE). Launched in 2012, MICE is part of MAS move towards a paper-less environment, leveraging on IT and an enterprisewide information classification exercise to manage our digital information assets. We have also introduced a series of tools and solutions to improve staff productivity, including mobility access to our enterprise IT resources.

UPHOLD HIGH GOVERNANCE AND OPERATIONAL STANDARDS WITHIN MAS Procurement Governance and Management MAS places emphasis on procurement to ensure a transparent, open and fair process. Most of our procurement officers have completed the advanced requirements under the Ministry of Finance Procurement Competency Training Framework in 2012. We have also reviewed our procurement practices and put in place new controls to further enhance our procedures. In addition, workshops and briefings were conducted annually to promote procurement best practices among MAS staff. Security and Fire Safety MAS received the National Safety & Security Watch Group Award from the Singapore Police Force and the Singapore Civil Defence Force for good security, safety, emergency preparedness and training practices and for sharing best practices and enhancing security collaboration efforts with other organisations in Singapore. Building Services and Infrastructure In the coming years, MAS will be compacting offices to optimise space usage and to enhance work synergy between functional work units. As part of WOG environmental sustainability effort, the building infrastructures and services will be upgraded by 2015 to meet new building requirements and energy standards. Risk-Based Audit The Internal Audit Department (IAD) of MAS completed an extensive programme of risk-based audits across the spectrum of MAS functions and key IT systems to ascertain the adequacy and effectiveness of controls and procedures. These included thematic reviews to assess the corporate governance standards within the organisation. IAD also conducted an extensive review of procurement practices across MAS. As part of our quality programme, IAD completed an internal Quality Assurance Review which was validated by the auditors from member organisations of the Inter-Statutory Board Quality
Assurance Validation Group. Both the selfassessment and external validation concluded that IADs activity, procedures and processes generally conform with the International Standards for the Professional Practice of Internal Auditing, issued by the Institute of Internal Auditors. ENHANCING MAS RISK MANAGEMENT CULTURE, OPERATIONAL RESILIENCE AND CRISIS PREPAREDNESS During the year, we introduced department self-assessments as a structured process for departments to identify, assess and prioritise their risks, and review the adequacy of controls that are in place. We also revised our information security policies to enhance safeguards for the handling of classified information. To ensure that MAS business continuity management (BCM) continues to be effective, we conducted a mobilisation exercise in November 2012 to validate our internal recovery processes. We also introduced an interactive e-learning module, known as the iBCM to deepen staffs knowledge and awareness of BCM issues and procedures.
FINANCIAL STATEMENTS
Financial Statement Highlights 66 Statement by Directors 64 Auditors Report 65 Consolidated Statement of Comprehensive Income 70 Consolidated Balance Sheet 71 Consolidated Statement of Changes in Equity 72 Consolidated Cash Flow Statement 73 Statement of Backing of Currency in Circulation 74 Notes to the Consolidated Financial Statements 75
MAS FY2012/2013 FINANCIAL STATEMENT HIGHLIGHTS
The Authoritys total assets, including the Currency Fund, increased by $21.21 billion to $340.40 billion in the financial year ended 31 March 2013. The Currency Funds net external assets grew by 4.5% to $38.81 billion, whilst the currency-in-circulation rose at a faster 9.5%. As a result, the net external asset backing of the currency-in-circulation fell to 121%, from 127% a year ago. Total liabilities also increased by $31.82 billion to $315.87 billion, with the higher currency-in-circulation, as the amounts due to the Singapore Government, MAS Bills, deposits of financial institutions and the currency-in-circulation grew. Most of the Authoritys assets comprise official foreign reserves, intended for the conduct of the monetary policy and the defence of the Singapore dollar. These are invested in a diversified range of foreign currency assets. During the year, the Singapore dollar appreciated against most currencies, including the Yen, the Sterling Pound, the Euro and the US dollar by 13.8%, 6.2%, 5.1% and 1.3% respectively. Following this, the Authority recorded a net loss of $10.61 billion for the year, as the foreign exchange impact from the stronger Singapore dollar exceeded the interest, dividend income and other gains from the foreign assets held. Total expenditure decreased from $0.89 billion to $0.82 billion, mainly due to lower investment and interest costs. For this financial year, there is no contribution to Consolidated Fund, nor return of profits to the Government.
STATEMENT By Directors
for the financial year ended 31 March 2013
In the opinion of the directors, (a) the consolidated financial statements of the Authority and its wholly-owned subsidiary, Singapore Sukuk Pte Ltd, as set out on pages 70 to 94 are drawn up so as to present fairly the state of affairs of the Authority as at 31March 2013, the results and changes in equity of the Authority for the financial year ended on that date, and of the cash flows of the Authority for the financial year then ended; and (b) at the date of this statement, there are reasonable grounds to believe that the Authority will be able to pay its debts as and when they fall due.
On behalf of the Board of Directors,
THARMAN SHANMUGARATNAM Chairman
RAVI MENON Managing Director 26 June 2013
INDEPENDENT AUDITORS REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS OF THE MONETARY AUTHORITY OF SINGAPORE
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2013
The accompanying financial statements of the Monetary Authority of Singapore (the Authority), its subsidiary and Currency Fund, set out on pages 70 to 94, have been audited under my direction. These financial statements comprise the consolidated balance sheet as at 31 March 2013, the consolidated statement of comprehensive income, consolidated statement of changes in equity, consolidated cash flow statement and statement of backing of currency in circulation for the financial year then ended, and a summary of significant accounting policies and other explanatory information.
Managements responsibility for the financial statements The management is responsible for the preparation and fair presentation of these financial statements in accordance with the provisions of the Monetary Authority of Singapore Act (Chapter 186, 1999 Revised Edition) and Currency Act (Chapter 69, 2002 Revised Edition) and applicable Singapore Financial Reporting Standards as explained in Note 3.1(a) to the consolidated financial statements, and for such internal controls as management determines are necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
Auditors responsibility My responsibility is to express an opinion on these financial statements based on the audit. The audit was conducted in accordance with the provisions of the Monetary Authority of Singapore Act and Currency Act and having regard to Singapore Standards on Auditing. Those standards require that ethical requirements be complied with, and that the audit be planned and performed to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal controls relevant to the entitys preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entitys internal controls. An audit also includes evaluating, within the context of applicable laws, the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the management, as well as evaluating the overall presentation of the financial statements. I believe that the audit evidence obtained is sufficient and appropriate to provide a basis for my audit opinion.
Opinion As disclosed in Note 3.1(a) to the consolidated financial statements, the Authority, in preparing these financial statements, is allowed under section 34(3) of the Monetary Authority of Singapore Act and section 21(10) of the Currency Act to comply with accounting standards to the extent that it is, in the opinion of the Authority, appropriate to do so, having regard to its objects and functions. As also disclosed in Note 3.1(a), the Authority has considered its responsibilities for managing the Singapore dollar exchange rate and the Official Foreign Reserves and is of the view that, for effective management of Singapores monetary policy, it would be appropriate not to meet, in some respects, the Singapore Financial Reporting Standards. The financial statements accordingly disclose less information than would be required under those Standards. Having regard to the power given to the Authority under section 34(3) of the Monetary Authority of Singapore Act and section 21(10) of the Currency Act, in my opinion, the consolidated financial statements present fairly, based on the framework of accounting standards adopted by the Authority, the state of affairs of the Authority and its subsidiary as at 31 March 2013 and the financial transactions of the Authority and its subsidiary for the financial year ended on that date.
TAN YOKE MENG WILLIE AUDITOR-GENERAL SINGAPORE 27 June 2013
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
General Reserve Fund For the year ended 31 March in $ millions Income/(Loss) from Foreign Operations [after transfers to/from provisions] Income from Domestic and Other Operations Non-operating Income Total Income/(Loss) [after transfers to/ from provisions] Note 2013 2012
Currency Fund 2013 2012 2013
Total 2012
(10,297)
3,046
225
329
(10,072)
3,375
5 6
268 9
276 10
1 2
269 11
276 10
(10,020)
3,332
228
329
(9,792)
3,661
Less: Investment, Interest and Other Expenses Personnel Expenditure General and Administrative Expenditure Depreciation/Amortisation Total Expenditure Profit/(Loss) for the Year [after transfers to/ from provisions]
7 8
453 183
560 177
118
89
571 183
649 177
50 17 703
47 17 801
118
89
50 17 821
47 17 890
(10,723)
2,531
110
240
(10,613)
2,771
Less: Contribution to Consolidated Fund Net Profit/(Loss) and Total Comprehensive Income/(Loss) for the Year [after transfers to/from provisions]
19.2
(10,723)
2,531
110
240
(10,613)
2,771
The accompanying notes form an integral part of these financial statements.
CONSOLIDATED BALANCE SHEET
As at 31 March in $ millions CAPITAL AND RESERVES Issued and Paid-up Capital General Reserve Fund Currency Fund Reserves
Note
2013
2012
10 11 12
25,000 (7,082) 6,621 24,539
25,000 2,481 7,671 35,152
Represented by: ASSETS Cash and Bank Balances Singapore Dollar Securities Foreign Financial Assets Gold Other Assets Property and Other Fixed Assets Less: LIABILITIES Currency in Circulation Deposits of Financial Institutions MAS Bills Provisions and Other Liabilities Amounts Due to Singapore Government 17 18 18 19 31,566 21,657 41,576 56,968 164,099 315,866 NET ASSETS OF THE AUTHORITY NET ASSETS OF FINANCIAL SECTOR DEVELOPMENT FUND The accompanying notes form an integral part of these financial statements. 20 24,539 1,154 28,826 17,981 17,993 69,643 149,605 284,048 35,152 1,090 15 16 13 14 858 7,115 321,182 262 10,816 172 340,405 860 7,011 305,230 266 5,666 167 319,200
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
in $ millions Balance as at 1 April 2011 Increase in Issued and Paid-up Capital during the Year Total Comprehensive Income/(Loss) for the Year (after transfers to/from provisions) Transfer of Reserves to Currency Fund Balance as at 31 March 2012 Total Comprehensive Income/(Loss) for the Year (after transfers to/from provisions) Transfer of Reserves from Currency Fund Balance as at 31 March 2013
Issued and Paid-up Capital 17,000
General Reserve Fund 41
Currency Fund Reserves 7,340
Total 24,381
8,000
8,000
25,000
2,531 (91) 2,481
240 91 7,671
2,771 35,152
25,000
(10,723) 1,160 (7,082)
110 (1,160) 6,621
(10,613) 24,539
The accompanying notes form an integral part of these financial statements.
CONSOLIDATED CASH FLOW STATEMENT
For the year ended 31 March in $ millions Cash Flows from Operating Activities Profit/(Loss) for the Year (after transfers to/from provisions) Adjustments for: Depreciation/Amortisation of Fixed Assets and Other Assets Profit/(Loss) before Working Capital Changes (Increase)/Decrease in Singapore Dollar Securities Foreign Financial Assets Gold Other Assets Increase/(Decrease) in Deposits of Financial Institutions MAS Bills Provisions and Other Liabilities Amounts due to Singapore Government (excluding Contribution to Consolidated Fund and Return of Profit to Singapore Government) Net Cash used in Operating Activities Cash Flows from Investing Activities Purchase of Fixed Assets Net Cash used in Investing Activities Cash Flows from Financing Activities Increase in Issued and Paid-up Capital Increase in Currency in Circulation Net Cash from Financing Activities Net Decrease in Cash and Bank Balances Cash and Bank Balances as at beginning of the year Cash and Bank Balances as at end of the year The accompanying notes form an integral part of these financial statements.
2013
2012
(10,613)
2,771
17
17
(10,596)
2,788
(104) (15,952) 4 (5,150)
263 (17,508) 1 (2,206)
3,676 23,583 (12,678)
416 17,993 (32,554)
14,494 (2,723)
19,931 (10,876)
(19) (19)
(15) (15)
2,740 2,740 (2) 860 858
8,000 2,886 10,886 (5) 865 860
STATEMENT OF BACKING OF CURRENCY IN CIRCULATION
The Currency Fund is established under Section 21 of the Currency Act (Chapter 69, 2002 Revised Edition). Section 22 of the Act states that the external assets of the Currency Fund shall not be less than 100% of the face value of the Currency in Circulation.
As at 31 March in $ millions The value of External Assets and the Currency in Circulation are: Currency in Circulation
Note
2013
2012
12.2
31,566
28,826
External Assets Less: Provisions and Other Liabilities Net Assets The accompanying notes form an integral part of these financial statements.
12.2
38,805
37,147
12.2
618 38,187
650 36,497
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 MARCH 2013
These notes form an integral part of and should be read in conjunction with the accompanying consolidated financial statements.
1 GENERAL 1.1 The Monetary Authority of Singapore (the Authority) is a statutory board established in Singapore under the Monetary Authority of Singapore Act (Chapter 186, 1999 Revised Edition) on 1January1971 and is located at 10 Shenton Way, MAS Building, Singapore079117. 1.2 The consolidated financial statements presented relate to those of the Authority and its wholly-owned subsidiary, Singapore Sukuk Pte Ltd (SSPL). The financial statements of the Authority are not materially different from the consolidated financial statements and have not been presented separately.
PRINCIPAL ACTIVITIES 2.1 The principal activities of the Authority are: a) the conduct of monetary policy, issuance of currency, management of the official foreign reserves and acting as the banker to and financial agent of the Government; and b) the supervision of the banking, insurance, securities and futures industries, and development of strategies in partnership with the private sector to promote Singapore as an international financial centre.
2.2 The Authoritys subsidiary, SSPL, is a special purpose entity incorporated in Singapore, to issue Sukuk certificates as Shariah-compliant assets to Islamic financial institutions to meet regulatory requirements.
SIGNIFICANT ACCOUNTING POLICIES 3.1 Compliance with the Monetary Authority of Singapore Act, Currency Act and Singapore Financial Reporting Standards a) The consolidated financial statements of the Authority, are prepared in accordance with the Monetary Authority of Singapore Act (Chapter186, 1999 Revised Edition), Currency Act (Chapter 69, 2002 Revised Edition) and applicable Singapore Financial Reporting Standards (FRS). Section 34(3) of the Monetary Authority of Singapore Act and Section21(10) of the Currency Act provide that the Authority, in preparing its consolidated financial statements, may comply with accounting standards to the extent that it is, in the opinion of the Authority, appropriate to do so, having regard to the objects and functions of the Authority. The Authority, having considered its responsibilities for managing the Singapore dollar exchange rate and the official foreign reserves, is of the opinion that, for effective management of Singapores monetary policy, it is appropriate not to meet, in some respects, the Singapore Financial Reporting Standards. The consolidated financial statements accordingly disclose less information than would be required under those Standards. b) Amendments to FRSs applicable in the current financial year did not have a significant impact on the Authoritys consolidated financial statements.

c) The preparation of consolidated financial statements in conformity with FRS requires management to exercise its judgement in the process of applying the Authoritys accounting policies, having regard to the objects and functions of the Authority. It also requires the use of accounting estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of income and expenditure during the financial year. Although these estimates are based on managements best knowledge of current events and actions, actual results may ultimately differ from these estimates. Basis of Accounting The consolidated financial statements have been prepared under the historical cost convention and on an accrual basis, except as otherwise disclosed.
3.2
3.3
Basis of Consolidation a) A subsidiary is an entity that the Authority, directly or indirectly, has power to govern the financial and operating policies of, in order to obtain benefits from its activities. It is generally accompanied by a shareholding of more than 50% of voting rights. Potential voting rights that are exercisable or convertible are considered when determining whether an entity is considered a subsidiary. b) A subsidiary is consolidated from the date control is established, acquired or transferred to the Authority to the date control ceases. The cost of an acquisition is measured as the fair value of the assets given, equity instruments issued or liabilities incurred or assumed at the date of exchange. c) Balances and transactions between the Authority and its subsidiary, together with any unrealised profits and losses arising from these transactions are eliminated, in preparing the consolidated financial statements. Foreign Currency Translation a) The consolidated financial statements are presented in Singapore dollars, the Authoritys functional currency, and rounded to the nearest million, unless otherwise stated. b) Transactions in foreign currency are measured at the exchange rate prevailing at the date of transaction. Foreign currency gains or losses resulting from the settlement of such transactions are recognised in the consolidated statement of comprehensive income. c) Assets and liabilities denominated in foreign currencies are translated into Singapore dollars, at the exchange rate prevailing on the balance sheet date, except for shareholdings in Bank for International Settlements (BIS) and Society for Worldwide Interbank Financial Telecommunication (SWIFT) which are converted at the rates of exchange prevailing on the acquisition dates. Exchange differences arising from the translation are recognised in the consolidated statement of comprehensive income.
3.4

3.5 Recognition and Derecognition Purchases and sales of investments are recognised on the trade date when the Authority commits to purchase or sell the asset. Investments are derecognised when the rights to receive cash flows from the financial assets have expired or have been transferred and the Authority has transferred substantially all risks and rewards of ownership. 3.6 Income Recognition a) Dividend income is recognised when the right to receive payment is established. b) Interest income is recognised on a time-proportionate basis using the effective interest method. The effective interest rate is the rate that discounts estimated future cash payments or receipts through the expected life of the financial instrument or, where appropriate, a shorter period to the net carrying amount. c) Profits/losses on disposal of investments are taken to the consolidated statement of comprehensive income. d) Licence fee income is recognised on a straight-line basis over the period of the licence. Singapore Dollar Securities Singapore Government Treasury bills and bonds and corporate bonds held are stated at cost. Provision has been made for diminution in value, if any, based on the lower of cost and market value on an individual investment basis. 3.8 Gold Gold is a long-term investment stated at cost. Provision for diminution in value would be made in the event of a decline other than temporary in its value. 3.9 Foreign Financial Assets Foreign financial assets represent the Authoritys investments in a global diversified portfolio and are stated at cost. Provision has been made for diminution in value, if any, based on the lower of cost and market value on an individual investment basis. 3.10 Financial Derivatives Financial derivatives include forwards, swaps, futures and options and are included in foreign financial assets. Other than financial instruments that are subject to margin requirements or central clearing which are fair valued, provision has been made for diminution in value, if any, of other financial derivatives based on the lower of cost and market value on an individual investment basis, except for forwards and currency swaps which are valued on a portfolio basis.
3.7

3.11 Repurchase and Reverse Repurchase Agreements (Repos and Reverse Repos) Reverse repos are treated as collaterised borrowing and the amounts borrowed are included in Provisions and Other Liabilities. The securities sold under reverse repos are treated as pledged assets and remain on the consolidated balance sheet. Repos are treated as collaterised lending and the amounts lent are included in Other Assets. The difference between the amount received and the amount paid under repos and reverse repos is recognised as interest income and interest expense respectively.
3.12 Property, Other Fixed Assets and Depreciation a) Property and other fixed assets are stated at cost less accumulated depreciation and impairment losses, if any. The cost includes expenditure that is directly attributable to the acquisition of the items. Depreciation is calculated on a straight-line basis to write off the cost less residual value of the fixed assets over their estimated useful lives as follows:
Useful lives Leasehold Land Period of lease Buildings 50 years or period of lease whichever is lower Building Improvements 10 years Computer Hardware and Software 3 to 5 years Furniture, Fixtures, Motor Vehicles 3 to 5 years and Other Equipment The residual values and useful lives are reviewed and adjusted as appropriate, at each balance sheet date. b) Computer software costs of less than $100,000 and other assets costing $1,000 and below are expensed off in the year of purchase. Any computer software costs not written off, are included in fixed assets. c) Property and other fixed assets are reviewed for impairment whenever there is any indication that these assets may be impaired. If such indication exists, the recoverable amount of the asset is estimated to determine the amount of impairment loss. The impairment loss is recognised in the consolidated statement of comprehensive income for the period. Reversal of impairment losses recognised in prior years is recorded when there is an indication that the impairment losses recognised for the asset no longer exist or have decreased. The reversal, if any, is recognised in the consolidated statement of comprehensive income. However, the increased carrying amount of an asset due to a reversal of an impairment is recognised to the extent that it does not exceed the carrying amount that would have been determined (net of depreciation or amortisation) had no impairment losses been recognised for the asset in prior years.
d) On disposal of fixed assets, the difference between the net disposal proceeds and its carrying amount is taken to the consolidated statement of comprehensive income.

3.13 Operating Leases a) Leases where substantially all the rewards and risks of ownership remain with the lessors are accounted for as operating leases. Rental receipts or payments under operating leases are accounted for in the consolidated statement of comprehensive income on an accrual basis according to the terms of the agreements. b) When an operating lease is terminated before the lease period has expired, any payment required to be made to the lessor by way of penalty is recognised as an income or expense in the period in which termination takes place.
3.14 Employee Benefits a) Defined contribution plans Defined contribution plans are post-employment benefit plans under which the Authority pays fixed contributions into entities such as the Central Provident Fund, and will have no legal or constructive obligation to pay further contributions. The Authoritys contributions to defined contribution plans are recognised in the financial year to which they relate.
b) Employee leave entitlement
Employee entitlements to annual leave are recognised when they accrue to employees. A provision is made for annual leave as a result of services rendered by employees up to the balance sheet date.
Income/(LOSS) from Foreign Operations Income/(Loss) from foreign operations includes interest, dividends, profit/loss on disposal of investments, foreign exchange gain/loss and write-back of/additional provision for diminution in value of investments.
Income from Domestic AND OTHER Operations Income from domestic and other operations includes mainly interest and write-back of/additional provision for diminution in value of Singapore Dollar securities, licence and inspection fees, revenue from currencyrelated operations, custody fee and revenue from services rendered to banks and financial institutions on MAS Network and MAS Electronic Payment System which provides real-time gross settlement of payments.
Non-Operating Income Non-operating income includes rental and carpark income, liquidated damages and management service fees.

Investment, Interest AND Other Expenses Investment and interest expenses include management fees, futures/options commissions, bank, custody and other charges arising from foreign operations, and interest paid on borrowings and reverse repurchase agreements arising from domestic and other operations. Other expenses include costs of printing of currency notes and coin operations.
Personnel expenditure 8.1 This includes the following:

in $ millions Salaries Employers Contribution to the Central Provident Fund Training and Personnel Development Staff Benefits 2013 158 15 4 3 2012 154 13 4 3
The Minister-in-charge of the Authority is not paid a salary by the Authority. Directors fees for the year totalled $0.12 million (2012: $0.10 million). All Ministers serving on the Authoritys Board of Directors do not receive directors fees. 8.2 The key management personnel compensation is as follows:
in $ millions Salaries and Other Short-term Employee Benefits Other Long-term Employee Benefits 2013 18 3 2012 19 3
Post-employment benefits of $0.6 million (2012: $0.5 million) were also provided to key management personnel. Executive Directors, Department Heads and above, are considered as key management personnel for this purpose.

General AND Administrative expenditure This includes the following:

in $ millions Information Technology IT Operating Lease Charges Information Services Official Trips and Conferences Building and Mechanical and Electrical Maintenance Consultant and Other Advisers Fees Property Tax Audit Fee 2013 11 4 4 4 3 2 2 1 2012 11 2 4 4 3 2 1
10
CAPITAL AND RESERVES 10.1 The issued and paid-up capital is wholly-owned by the Government of the Republic of Singapore. 10.2 The Authority manages its capital and reserves at an appropriate and adequate level, in pursuit of the Authoritys principal objects, as set out in Section 4 of the Monetary Authority of Singapore Act (Chapter 186, 1999 Revised Edition) that is, to maintain price stability conducive to sustainable economic growth, foster a sound and reputable financial centre, grow Singapore as an internationally competitive financial centre and ensure prudent and effective management of the official foreign reserves of Singapore. As required by the Constitution of the Republic of Singapore, the Authority has to determine and safeguard the past reserves of the Authority which were not accumulated during the current term of office of the Government. 10.3 Taking into consideration the Authoritys capital and reserves needs for its principal objects, the Authority conducts capital and reserves adequacy assessment regularly. It includes a comprehensive assessment of risks that the Authority is exposed to, the measurement, monitoring and stress testing of these risks and an evaluation of the adequacy of the Authoritys capital and reserves in relation to these risks. 10.4 The return of profit to the Singapore Government, from the General Reserve Fund and/or from the net profit for each financial year, is determined by the Authority and the remainder of the net profit, if any, is credited to the General Reserve Fund, in accordance with Section 6 of the Monetary Authority of Singapore Act (Chapter 186, 1999 Revised Edition).
11
GENERAL RESERVE FUND The General Reserve Fund is established under Section 6(1) of the Monetary Authority of Singapore Act (Chapter 186, 1999 Revised Edition).

12
CURRENCY FUND RESERVES 12.1 The Currency Fund, established under Section 21 of the Currency Act (Chapter 69, 2002 Revised Edition), is maintained and managed by the Authority in the manner prescribed by the Act. 12.2 The assets and liabilities of the Currency Fund as at 31 March are as follows:
in $ millions External Assets Gold Foreign Investments 14.1(a) 205 38,600 38,805 208 36,939 37,147 Note 2013 2012
Less: Liabilities Active Currency in Circulation Currency Held by the Authority Currency in Circulation Provisions and Other Liabilities 30,724 842 31,566 618 32,184 Currency Fund Reserves 6,621 27,977 849 28,826 650 29,476 7,671
13
SINGAPORE DOLLAR SECURITIES Singapore Dollar Securities comprise:

in $ millions Singapore Government Bonds Singapore Dollar Corporate Bonds 2013 7,105 10 7,115 2012 7,011 7,011

14 FOREIGN FINANCIAL ASSETS

14.1(a) These comprise the following:

General Reserve Fund in $ millions Foreign Investments Bank Balances and Deposits Securities (including Treasury Bills, Bonds and Equities) Other Foreign Investments International Monetary Fund Assets (see note 14.2) Reserve Tranche Special Drawing Rights Loans under New Arrangements to Borrow Poverty Reduction and Growth Facility Heavily Indebted Poor Countries Shareholding in Bank for International Settlements (BIS) (see note 14.3) 22.1(d) 881 1,622 292 920 1,691 191 881 1,622 292 920 1,691 191 49,842 47,399 2,681 3,441 52,523 50,840 Note 2013 2012
Currency Fund 2013 2012 2013
Total 2012
237,631 9,502
224,015 9,217
37,644 1,289
33,896 1,467
275,275 10,791
257,911 10,684
96 299,874
96 283,537 (15,246) 268,291
41,614 (3,014) 38,600
38,804 (1,865) 36,939
96 341,488 (20,306) 321,182
96 322,341 (17,111) 305,230
Foreign Currency Liabilities Net Foreign Financial Assets
(17,292) 282,582

14.1(b) During the financial year ended 31 March 2013, the Authority recognised cash collateral received in connection with financial transactions as an asset in Bank Balances and Deposits and a payable in Foreign Currency Liabilities. Cash collateral pledged are derecognised from cash in Bank Balances and Deposits and recorded as a receivable in Other Foreign Investments. Prior years comparatives have been restated to include the adjustments outlined below:
General Reserve Fund in $ millions Foreign Investments Bank Balances and Deposits Other Foreign Investments 6,090 178 6,268 Foreign Currency Liabilities Net Foreign Financial Assets (6,268) 1,512 22 1,534 (1,534) 7,602 200 7,802 (7,802) 2012
Currency Fund 2012
Total 2012
14.2 International Monetary Fund (Imf) Assets
The Reserve Tranche represents the amount of the paid-up portion of the Singapore quota. Special Drawing Rights (SDRs) are interest-yielding balances with IMF that can be exchanged for convertible currencies. Singapore participates in the Poverty Reduction and Growth Facility-Heavily Indebted Poor Countries (PRGF-HIPC). The PRGF-HIPC outstanding balance as at 31 March 2013 is SDR4.0 million [$7.5million] (31 March 2012: SDR4.0 million [$7.9million]), being the balance in Post-Special Contingent Account-2 with IMF which was transferred to the PRGF-HIPC on 24 April 2001 as an interest-free deposit maturing at the end of 2018. 14.3 Bank for International Settlements (Bis)
The Authoritys shareholding in the BIS comprises the 25% paid-up value of 4,285 (31 March 2012: 4,285) shares with a nominal value of SDR5,000 ($9,290) each.
15 OTHER ASSETS These comprise the following:

in $ millions Loans, Deposits and Other Receivables Receivable from MAS Bills Issued Repurchase Agreements with Singapore Government 2013 3,881 4,398 2,537 10,816 2012 3,437 2,229 5,666

16
PROPERTY AND OTHER FIXED ASSETS

Furniture, Fixtures, Motor Vehicles and Other Equipment
in $ millions COST As at 1.4.2011 Additions Disposals Transfers As at 31.3.2012 ACCUMULATED DEPRECIATION As at 1.4.2011 Disposals Depreciation Charge As at 31.3.2012 NET BOOK VALUE AS AT 31.3.2012
Leasehold Land
Building Buildings Improvements
Computer Hardware and Software
Work-inProgress
Total
48 48
171 171
93 1 94
84 5 (4) 85
23 1 2 26
5 14 (2) 17
424 21 (4) 441
14 1 15
75 4 79
82 3 85
68 (4) 7 71
22 2 24
261 (4) 17 274
33
92
14
17
167
COST As at 1.4.2012 Additions Disposals Transfers As at 31.3.2013 ACCUMULATED DEPRECIATION As at 1.4.2012 Disposals Depreciation Charge As at 31.3.2013 NET BOOK VALUE AS AT 31.3.2013 15 1 16 79 4 83 85 3 88 71 (1) 8 78 24 1 25 274 (1) 17 290 48 48 171 171 94 94 85 2 (1) 25 111 26 1 1 28 17 19 (26) 10 441 22 (1) 462
32
88
33
10
172

17
DEPOSITS OF FINANCIAL INSTITUTIONS

in $ millions Banks Finance Companies Securities Companies 2013 21,243 323 7 21,573 International Financial Institutions Foreign Central Banks and Others 34 50 21,657 2012 17,668 266 6 17,940 34 7 17,981
Deposits from banks and finance companies in Singapore include the minimum cash balances maintained by banks and finance companies with the Authority as required under the Banking Act (Chapter 19, 2008 Revised Edition) and the Finance Companies Act (Chapter 108, 2011 Revised Edition) respectively. Deposits from securities companies represent statutory deposits from holders of capital markets services licences required under the Securities and Futures (Licensing and Conduct of Business) Regulations.
18
MAS BILLS, Provisions AND Other Liabilities 18.1 As part of the Authoritys money market operations to manage the liquidity in the banking system, the Authority expanded its money market instruments by issuing its own bills, with short-term maturities ranging up to 3 months, during the financial year ended 31 March 2013. 18.2 Provisions have been made for contingencies under Section 6(2) of the Monetary Authority of Singapore Act (Chapter186, 1999 Revised Edition). Other liabilities include borrowings from banks, borrowings under reverse repurchase agreements, the Authoritys allocations of Special Drawing Rights in IMF, creditors, Sukuk payable, accounts payable and accruals. 18.3 The Authoritys allocations of Special Drawing Rights in IMF amounting to $1,383 million as at 31 March 2013 (31 March 2012: $1,449 million) is included in Provisions and Other Liabilities. 18.4 During the financial year ended 31 March 2013, SSPL, a wholly-owned subsidiary of the Authority, issued $100 million (2012: $80 million) Sukuk trust certificates with one year maturity and an income distribution rate of 0.29% (2012: 0.30%) per annum. The Sukuk issuance by SSPL is structured on the sale-and-leaseback or Al Ijarah of property assets of the Authority. Under agreements with SSPL, the Authority will sell, leaseback, provide a purchase undertaking of the property assets and receive from and make periodic payments to SSPL.

19
AMOUNTS DUE TO SINGAPORE GOVERNMENT 19.1 The amounts due to the Singapore Government comprise the following:
in $ millions Amounts due to Singapore Government, arising from Repurchase Agreements Balances and Deposits of Singapore Government 2013 2,537 161,562 164,099 2012 2,229 147,376 149,605
19.2 Contribution to the Consolidated Fund is in accordance with the Statutory Corporations (Contributions to Consolidated Fund) Act (Chapter 319A, 2004 Revised Edition) and is based on 17% (2012: 17%) of the net profit for the year. In the financial year ended 31 March 2013, no contribution to the Consolidated Fund (2012: Nil) is payable as the Authority recorded a net loss for the year.
20
FINANCIAL SECTOR DEVELOPMENT FUND 20.1 The Financial Sector Development Fund (hereinafter called the Fund) is established under Section 30A of the Monetary Authority of Singapore Act (Chapter 186, 1999 Revised Edition). It is controlled and administered by the Authority. The Authority provides administrative and accounting support to the Fund. The Fund shall be used for the objects and purposes set out in Section30B of the Act.

20.2 The financial statements of the Fund have been prepared in accordance with the provisions of the Monetary Authority of Singapore Act (Chapter 186, 1999 Revised Edition) and the Singapore Financial Reporting Standards. The assets and liabilities of the Fund as at 31 March are as follows:
in $ thousands ACCUMULATED FUND Capital Account Accumulated Surplus 471,635 681,934 1,153,569 Represented by: ASSETS Bank Balances and Deposits Financial Assets at Fair Value through Profit or Loss Loans and Receivables Less: LIABILITIES Financial Liabilities at Fair Value through Profit or Loss Accruals and Other Liabilities 2,360 59,218 61,578 NET ASSETS OF THE FUND 1,153,569 1,653 62,844 64,497 1,090,400 20.4 241,206 952,426 21,515 1,215,147 286,573 838,774 29,550 1,154,897 471,635 618,765 1,090,400 Note 2013 2012

20.3 The financial results of the Fund are as follows:

in $ thousands Interest Income Dividend Income Gain from Financial Instruments at Fair Value through Profit or Loss Foreign Exchange Loss Other Income Total Income Less: Investment Expenses Grants Total Expenditure Net Surplus and Total Comprehensive Income for the Year 4,859 31,595 36,454 63,169 3,455 43,894 47,349 64,051 2013 18,853 70,402 40,782 (30,707) 293 99,623 2012 25,146 69,186 28,303 (11,885) 650 111,400
20.4 Bank Balances and Deposits Included in bank balances and deposits of $241.2 million as at 31 March 2013 is US$50.0 million ($62.0 million) (31 March 2012: $62.9 million) held by Singapore Exchange Ltd, in trust for the Fundsupported market infrastructure project. The Fund reserves the right, to vary or change the amount for the project or withdraw any part of or the entire amount for this project, and recover in full, or part, any moneys disbursed if specified terms and conditions, including satisfying the projects key performance indicators, are not met or upon the occurrence of specified events.
20.5 Related Party Transactions a) During the financial year, the Fund maintained a non-interest bearing current account with the Authority to facilitate grant disbursements. The Funds current account balance with the Authority at 31 March 2013 was $6.9 million (31 March 2012: Nil). b) The Fund also placed deposits with the Authority, in the ordinary course of business and at arms length, earning interest income disclosed below:
in $ thousands Interest Income 2013 444 2012 360
c) The Funds deposit balance with the Authority at 31 March 2013 was $118.0million (31 March 2012: $149.0 million).
20.6 The notes to the assets and liabilities and financial results of the Fund are available on the Authoritys website at http://www.mas.gov.sg.

21
STATUTORY DEPOSITS OF INSURANCE COMPANIES, REMITTANCE LICENSEES AND CAPITAL MARKETS SERVICES LICENSEES The following statutory bank deposits, guarantees and Singapore Government bonds of insurance companies, remittance licensees and capital markets services licensees, are retained by the Authority under the Insurance Act (Chapter 142, 2002 Revised Edition), the Money-Changing and Remittance Businesses Act (Chapter 187, 2008 Revised Edition) and the Securities and Futures Act (Chapter 289, 2006 Revised Edition) respectively, and in the events specified, dealt with accordingly under the respective Acts.
in $ millions Insurance Companies Fixed Deposits Bankers Guarantees 287 287 Remittance Licensees Bankers Guarantees Capital Markets Services Licensees Bankers Guarantees 56 55 19 19 184 2 186 2013 2012
22 COMMITMENTS 22.1 International Monetary Fund (IMF) a) The Authority has an obligation to pay $1,791 million as at 31 March 2013 (31 March 2012: $1,863 million) which represents the unpaid portion of the Singapore quota due to IMF under Section 4 of Article III of the Articles of Agreement. b) On 15 December 2010, the IMFs Board of Governors passed a resolution that would double the Funds total quotas and result in a major realignment of quota shares among members. As at 31 March 2013, Singapore has accepted its full quota increase of SDR2,484 million ($4,615 million). c) On 20 April 2012, the Authority announced that Singapore would make a bilateral contingent loan of US$4 billion ($5 billion) to the IMF as part of the broader international effort to boost IMFs resources and strengthen global economic and financial stability. d) As a participant in the IMFs New Arrangements to Borrow (NAB), the Authority undertakes to provide a credit line in the event of a financial emergency as specified by the NAB. During the financial year ended 31March2013, the Authority granted loans under the NAB totalling SDR157 million ($292 million) (31 March 2012: SDR98 million [$191 million]). The remaining undrawn credit is SDR1,120 million ($2,080 million) as at 31 March 2013 (31 March 2012: SDR1,179 million [$2,296 million]).

e) During the financial year ended 31 March 2013, the Authority received SDR4.1 million ($8 million), being Singapores share of the distribution of SDR700 million ($1,300 million) by IMF arising from the profits made in the IMFs gold sales. Subsequent to 31 March 2013, the Authority may also receive about SDR10 million ($19 million) from a second distribution of SDR1,750 million ($3,251 million) expected to be made by the IMF if it receives assurances, similar to the first distribution, from members that they will provide new Poverty Reduction and Growth Trust (PRGT) subsidy contributions totalling at least 90% of the distributed amount. For both distributions, Singapore has pledged to contribute its share to the PRGT subsidy account, subject to legislative amendments.
22.2 Bank for International Settlements (BIS)
The Authority has a commitment, amounting to SDR16.1 million ($29.9 million) as at 31 March 2013 (31 March 2012: SDR16.1 million [$31.3 million]), in respect of the uncalled portion of its shareholding in the BIS. 22.3 Repurchase Agreements with Central Banks and Monetary Authority
The Authority has entered into bilateral repurchase agreements totalling US$5,500 million ($6,822 million) with various Asian central banks and a monetary authority to provide liquidity assistance in times of emergency. For the financial year ended 31 March 2013, there was no request for liquidity assistance from any counterpart. 22.4 Currency Swap Arrangements with Central Banks and Monetary Authority a) The Authority is a participant in the multilateral ASEAN Swap Arrangement (ASA) together with other ASEAN central banks and a monetary authority to provide short-term foreign exchange liquidity support for member countries that may experience balance of payments difficulties. Under this agreement, the Authoritys commitment is US$300 million ($372 million). In September 2011, the ASA was renewed for an additional two years up to 16November2013. b) The Authority is Singapores Swap Providing / Requesting Party in the Chiang Mai Initiative Multilateralisation (CMIM) Agreement involving the ASEAN member states, China (including the Hong Kong Monetary Authority, China), Japan and Korea. The CMIM Agreement, effective from 24 March 2010, provides financial support through currency swap transactions, to address balance of payments and short-term liquidity difficulties in the region, and supplements existing international financial arrangements. On May 2012, the Chiang Mai Initiative Multilateralisation (CMIM) members agreed to strengthen the regional financial safety net and double the total size of the currency swap transactions with members to US$240 billion. The Authoritys commitment is US$9,104 million ($11,292 million) and the Authority can swap Singapore dollars for US dollars up to 2.5 times Singapores commitment. c) The Authority established a 3-year China-Singapore currency swap arrangement of CNY150 billion ($30 billion) with the Peoples Bank of China on 23 July 2010, to promote bilateral trade and direct investment for the economic development of the two countries. On 8 March 2013, the Authority renewed and expanded the swap facility to CNY300 billion ($60 billion). This CNY/SGD swap facility allows the Authority to provide Chinese Yuan liquidity to financial institutions for trade and financial stability purposes. d) For the financial year ended 31 March 2013, there was no request made or drawdown of any of the above currency swap arrangements, (a) to (c).

22.5 Liquidity Loan Facility The Authority entered into an agreement with the Singapore Deposit Insurance Corporation Limited (SDIC) on 9 February 2012 where the Authority may provide the SDIC a contingent liquidity facility of up to $20 billion, in the event a Deposit Insurance Scheme member fails and liquidity is needed for compensation payments to insured depositors. For the financial year ended 31March 2013, there was no request and drawdown on the facility. 22.6 Capital Expenditure Commitments Capital expenditure not provided for in the consolidated financial statements is as follows:
in $ millions Amount contracted for 2013 14 2012 18
22.7 Leases a) Future minimum lease payments under non-cancellable operating leases are as follows:
in $ millions Less than 1 year 1 to 5 years More than 5 years 2013 1 2 3 2012 1 2 1 4
b) Future minimum lease rental receipts under non-cancellable operating leases are as follows:
in $ millions Less than 1 year 1 to 5 years 2013 6 6 12 2012 6 4 10
23
FINANCIAL RISK MANAGEMENT 23.1 The Risk Committee, chaired by an independent Board Director, assists the Board of Directors in providing oversight and guidance over the management of risks assumed by the Authority. This encompasses the management of financial risks inherent in the Authoritys investment portfolios, amongst other organisational risks faced by the Authority. 23.2 The Risk Management Department provides senior management and the Risk Committee with regular reports of the risk profiles of the Authoritys investments. These reports cover risk measurement and analysis of the Authoritys investment portfolios. The department also formulates risk policies and controls, and performs independent compliance monitoring of the portfolios in accordance with the stipulated investment guidelines.

23.3 Market Risk a) Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices and includes currency, interest rate and other price risks. i) Currency risk is the risk of loss on foreign assets and liabilities arising from changes in foreign exchange rates.
ii) Interest rate risk is the risk of loss arising from changes in market interest rates. The Authority manages interest rate risks by setting duration limits on its investments. iii) Other price risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices (other than those arising from interest rate risk or currency risk), whether those changes are caused by factors specific to the individual financial instrument or its issuer, or factors affecting all similar financial instruments traded in the market.
b) Market risk is managed through regular monitoring of the market risk exposure of the Authoritys investments, the diversification of the Authoritys investments across different markets and currencies, and the establishment of investment risk tolerance and controls at both the aggregate and individual portfolio levels.
23.4 Credit Risk a) Credit risk is the risk of loss arising from a partys failure to discharge an obligation under a financial contract and includes counterparty, custodian and issuer credit risk. b) The Authoritys credit risks are managed by transacting with well-rated entities within assigned limits. Credit risks are also mitigated by diversifying credit exposures across counterparties, custodians and issuers and through collateral arrangements with counterparties whom the Authority has signed the International Swaps and Derivatives Association (ISDA) Credit Support Annex. c) The Authority manages issuer credit risk by imposing minimum credit rating requirements on the investment of fixed income securities. Single issuer limits are placed to control the credit exposure to any one issuer and to mitigate the extent of loss resulting from a default.
23.5 Country Risk
The Authoritys foreign assets are exposed to country credit risk arising from political, economic and financial events in the country of investment. Country limits are established to control the Authoritys credit risk exposure to individual countries. 23.6 Liquidity Risk
Liquidity risk is the risk arising from the inability to sell a financial asset at close to its fair value at short notice due to inadequate market depth or market disruptions. The Authority manages liquidity risk by investing mostly in liquid financial instruments and markets, and imposing limits on investments to ensure sufficient diversification.

24
SEGMENT REPORTING Owing to their integrated nature, the Authoritys operations, including those of its subsidiary, SSPL, comprise one main operating segment only, i.e. the conduct of monetary policy, issuance of currency, management of the official foreign reserves and acting as the banker to and financial agent of the Government, for segment reporting purposes. In addition, the Authoritys operations are mainly in one geographical area, Singapore. All other segment information are below the quantitative thresholds for separate disclosure.
25
NEW OR REVISED ACCOUNTING STANDARDS AND INTERPRETATIONS New or revised accounting standards and interpretations to existing standards have been issued that are relevant for the Authoritys accounting periods beginning on or after 1 January 2013 or later periods and which the Authority has not early adopted. The Authority does not expect the following revised accounting standards that are applicable, to have a significant impact on the Authoritys consolidated financial statements.
Effective for annual periods beginning on or after 1 January 2014 FRS 110 Consolidated Financial Statements FRS 110 establishes control as the basis for determining which entities are consolidated. It provides a single model to be applied in the control analysis for all investees, including special purpose entities that are currently within the scope of INT FRS 12 Consolidation Special Purpose Entities. Control exists under FRS 110 when the investor has power, exposure to variable returns and the ability to use that power to affect its return from the investee. FRS 112 Disclosure of Interests in Other Entities FRS 112 combines the existing disclosure requirements in a single disclosure standard. It requires the disclosure of summarised financial information about each subsidiary that has material non-controlling interests as well as associate and joint venture that is material to the reporting entity. It also sets out new disclosure requirements such as financial or other support provided to consolidated and unconsolidated structured entities, and financial information about unconsolidated structured entities that the reporting entity had sponsored.
26
AUTHORISATION OF CONSOLIDATED FINANCIAL STATEMENTS The consolidated financial statements for the year ended 31 March 2013 were authorised by the Board of Directors for issuance and signed by Chairman and Managing Director on 26June2013.
Key Economic and Financial Statistics
Key Economic and Financial Statistics
2008 National Income Aggregates Gross Domestic Product At Current Market Prices (S$m) Growth Rate (% change) At 2005 Market Prices (S$m) Growth Rate (% change) Gross National Income At Current Market Prices (S$m) Growth Rate (% change) Labour Force Unemployment Rate (%) Productivity Growth (% change) Changes in Employment (000) Average Monthly Earnings (% change) Unit Labour Cost (% change) Savings and Investment Gross National Savings (S$m) As % of GNI Gross Domestic Capital Formation (S$m) As % of GNI Balance of Payments (S$m) Goods Balance Exports of Goods Growth Rate (% change) Imports of Goods Growth Rate (% change) Services and Other Balances Current Account Balance As % of GNI Capital and Financial Account Balance Balancing Item Overall Balance Official Foreign Reserves Inflation (% change) Consumer Price Index GDP Deflator Monetary Aggregates (% change) M1 M2 M3 18.4 12.0 11.6 6.6 -1.1 60,561.7 501,615.1 6.5 441,053.4 14.9 -19,759.5 40,802.2 15.9 -22,986.9 715.8 18,531.1 250,346.0 119,896.5 46.6 79,094.3 30.7 2.2 -7.3 221.6 5.4 4.2 257,366.9 -0.8 269,658.1 0.6 251,538.9 1.7
2009
2010
2011
2012
274,655.3 1.9 249,559.8 -0.8 259,942.7 1.0
315,921.2 15.0 286,446.7 14.8 314,389.2 20.9
334,092.7 5.8 301,228.4 5.2 331,346.7 5.4
345,560.5 3.4 305,201.5 1.3 341,640.9 3.1
3.0 -3.4 37.6 -2.6 0.8
2.2 11.1 115.9 5.6 -2.6
2.0 1.3 122.6 6.0 3.5
2.0 -2.6 129.1 2.3 4.1
117,249.8 45.1 68,549.7 26.4
152,226.6 48.4 67,654.3 21.5
156,296.9 47.2 74,135.2 22.4
157,575.9 46.1 93,296.0 27.3
71,721.1 419,694.1 -16.3 347,973.0 -21.1 -23,021.0 48,700.1 18.7 -35,737.0 3,493.1 16,456.2 263,955.4
90,005.9 505,879.1 20.5 415,873.2 19.5 -5,433.6 84,572.3 26.9 -30,505.9 3,414.1 57,480.5 288,954.1
91,395.9 546,103.2 8.0 454,707.3 9.3 -9,234.2 82,161.7 24.8 -55,600.3 -5,073.7 21,487.7 308,403.2
76,127.1 544,587.5 -0.3 468,460.4 3.0 -11,847.2 64,279.9 18.8 -35,586.3 3,912.3 32,605.9 316,744.2
0.6 2.7
2.8 0.2
5.2 0.6
4.6 2.1
23.5 11.3 10.6
20.3 8.6 8.3
16.1 10.0 10.1
7.7 7.2 7.6
2008 Interest Rates (period average, % per annum) Prime Lending Rate Banks 3-month Fixed Deposit Rate Banks 3-month Domestic Interbank Rate 3-month US$ SIBOR Exchange Rates (period average, S$ per) US Dollar Pound Sterling Euro 100 Japanese Yen Malaysian Ringgit Banking and Finance Commercial Banks Assets/Liabilities (S$m) Growth Rate (% change) Finance Companies Assets/Liabilities (S$m) Growth Rate (% change) Merchant Banks Assets/Liabilities (S$m) Growth Rate (% change) Asian Currency Units Assets/Liabilities (US$m) Growth Rate (% change) Insurance Life Insurers Assets/Liabilities (S$m) Growth Rate (% change) General Insurers Assets/Liabilities (S$m) Growth Rate (% change) CPF Excess of Contributions Over Withdrawals (S$m) Domestic Capital Market Net Funds Raised in Domestic Capital Market (S$m) 42,859.4 9,265.1 99,985.7 -11.1 15,062.0 -7.7 668,298.4 14.7 12,586.4 -1.5 72,602.3 -18.5 912,739.4 0.6 1.4148 2.6162 2.0771 1.3738 0.4247 5.38 0.42 1.32 2.93
2009
2010
2011
2012
5.38 0.29 0.70 0.70
5.38 0.21 0.57 0.35
5.38 0.17 0.41 0.34
5.38 0.14 0.38 0.43
1.4545 2.2737 2.0242 1.5562 0.4126
1.3635 2.1073 1.8095 1.5543 0.4234
1.2579 2.0161 1.7495 1.5780 0.4111
1.2497 1.9803 1.6071 1.5672 0.4046
706,814.2 5.8 11,691.9 -7.1 76,354.4 5.2 869,399.6 -4.7
781,607.4 10.6 11,523.6 -1.4 89,760.3 17.6 971,299.4 11.7
855,811.5 9.5 12,165.3 5.6 87,851.0 -2.1 1,019,532.8 5.0
911,000.4 6.4 14,967.5 23.0 92,411.0 5.2 1,093,263.8 7.2
119,895.5 19.9 15,905.8 5.6
131,903.7 10.0 17,431.6 9.6
133,905.4 1.5 27,209.4 56.1
148,592.5 11.0 26,267.6 -3.5
9,404.4
12,374.2
14,184.8
14,321.6
56,566.5
61,221.5
82,763.6
78,664.9
Statistical Annex
A. MONETARY STATISTICS A1. Money Supply A2. Official Foreign Reserves A3. Exchange Rates A4. Domestic Interest Rates 98 99 100 101
B. FINANCIAL STRUCTURE B1. Number of Financial Institutions in Singapore C. COMMERCIAL BANKS C1. Assets and Liabilities C2. Loans and Advances by Industrial Classification C3. Types of Loans and Advances to Non-Bank Customers C4. Types of Deposits including S$NCDs C5. Liquidity Position D. FINANCE COMPANIES D1. Assets and Liabilities E. MERCHANT BANKS E1. Consolidated Assets and Liabilities E2. Assets and Liabilities of Domestic Unit Operations F. INSURANCE INDUSTRY F1. Assets and Premiums G. NON-BANK FINANCIAL INSTITUTIONS G1. Central Provident Fund Board H. DOMESTIC CAPITAL MARKET H1. Net Funds Raised in the Domestic Capital Market I. ASIAN DOLLAR MARKET I1. Assets and Liabilities I2. Maturity Transformation by Asian Currency Units
102
104 105 106 107 108
109
110 111
112
113
114
115 116
A.1
MONETARY STATISTICS: MONEY SUPPLY
End of Period 46,085.9 14,584.5 31,501.4 173,712.4 107,714.3 65,588.9 409.2 219,798.3 5,901.3 225,699.6 268,749.1 306,754.9 342,387.5 6,379.3 9,196.0 8,976.4 262,369.8 297,558.9 333,411.1 371,207.9 7,318.1 378,526.0 220.8 65.7 18.0 0.0 68,287.0 81,822.9 102,567.4 121,004.7 141,619.4 151,731.7 155,121.9 156,731.1 154,417.3 136,171.8 20.0 403,096.1 7,013.2 410,109.3 210,127.2 233,620.3 257,707.3 277,735.8 290,609.1 36,957.9 47,270.1 56,706.4 73,255.6 90,187.5 15,284.7 16,668.5 18,997.4 20,216.5 22,299.5 24,690.3 105,901.6 312,766.2 160,699.6 151,901.6 165.0 443,358.1 8,308.2 451,666.3 52,242.6 63,938.6 75,703.8 93,472.1 112,487.0 130,591.9
2004
2005
2006
2007
2008
2009
2010
2011
2012 140,709.1 26,361.3 114,347.8 334,683.4 175,270.8 159,322.4 90.2 475,392.5 10,522.9 485,915.4
S$ Million March 2013 148,864.4 27,868.1 120,996.3 343,397.3 175,745.8 167,534.7 116.8 492,261.7 10,822.9 503,084.6
Money Supply (M1)
44,162.3
Currency in active circulation 1
13,694.0
Demand deposits
30,468.3
Quasi-money
162,815.6
Fixed deposits
93,360.2
Savings and other deposits
68,940.4
S$NCDs
515.0
Money Supply (M2)
206,977.9
Net deposits with finance companies
5,204.8
Money Supply (M3)
212,182.7
1 Figures exclude commemorative, numismatic and bullion coins issued by the Monetary Authority of Singapore and cash held by commercial banks and other financial institutions. The Board of Commissioners of Currency, Singapore, merged with the Monetary Authority of Singapore in October 2002.
A.2
MONETARY STATISTICS: OFFICIAL FOREIGN RESERVES 1
End of Period 192,813.0 192,044.6 291.2 477.2 487.5 503.9 544.1 2,205.3 1,969.8 200.1 128.6 255.8 375.5 421.0 208,304.2 233,913.1 249,546.1 261,374.6 286,563.3 305,589.5 1,080.8 1,732.9 208,991.8 234,545.6 250,346.0 263,955.4 288,954.1 308,403.2
2004
2005
2006
2007
2008
2009
2010
2011
2012 316,744.2 313,987.3 1,115.8 1,641.1
S$ Million March 2013 320,224.9 317,462.5 1,140.6 1,621.8
Total Foreign Reserves
183,464.0
Gold & Foreign Exchange
182,276.8
Reserve Position in the IMF
712.4
Special Drawing Rights (SDRs)
474.8
Total Foreign Reserves (US$ million) 116,172.6 136,260.9 162,956.8 174,196.3 187,809.1
112,574.9
225,754.2
237,737.0
259,307.1
258,186.3
1 With effect from May 1999, the book value of foreign reserve assets are translated at market exchange rates prevailing at the end of each reporting month.
A.3
MONETARY STATISTICS: EXCHANGE RATES
S$ Per Foreign Currency 2004 1.6646 1.5138 2.0719 3.0290 1.3383 1.2686 0.1625 5.1768 0.2140 0.4395 0.0414 0.0172 0.0173 0.0165 0.0147 0.0419 0.0436 0.0424 0.4331 0.4384 0.4247 0.2045 0.1932 0.1817 0.1876 0.4126 0.0424 0.0140 4.8870 4.5870 4.4874 4.4023 0.1664 0.1622 0.1306 0.1143 1.1967 1.2624 1.2016 1.1473 1.2684 1.2563 1.3090 1.3407 1.3089 1.2524 0.1180 4.3292 0.1755 0.4234 0.0430 0.0150 2.9261 3.0161 2.6162 2.2737 2.1073 1.9952 2.0638 2.0771 2.0242 1.8095 1.3667 1.2806 1.3738 1.5562 1.5543 1.5889 1.5071 1.4148 1.4545 1.3635 1.2579 1.5780 1.7495 2.0161 1.4201 1.2971 0.1135 4.2798 0.1616 0.4111 0.0413 0.0143 2005 2006 2007 2008 2009 2010 2011 2012 1.2497 1.5672 1.6071 1.9803 1.3332 1.2940 0.1109 4.2262 0.1611 0.4046 0.0402 0.0133 1st Qtr 2013 1.2377 1.3416 1.6346 1.9194 1.3301 1.2852 0.1141 4.1990 0.1596 0.4016 0.0415 0.0128
Period Average
US Dollar
1.6903
100 Japanese Yen
1.5634
Euro
2.1008
Pound Sterling
3.0963
Swiss Franc
1.3609
Australian Dollar
1.2443
100 Korean Won
0.1477
100 New Taiwan Dollar
5.0584
Hong Kong Dollar
0.2170
Malaysian Ringgit
0.4448
Thai Baht
0.0420
100 Indonesian Rupiah
0.0189
Note: Currencies quoted are those frequently requested from the Authority.
A.4
MONETARY STATISTICS: DOMESTIC INTEREST RATES
Period Average
2004
2005
2006
2007
2008
2009
2010
2011
Per Cent Per Annum 1st Qtr 2012 2013
Banks 1 Prime Lending Rate Fixed Deposit Rate 3-month 6-month 12-month Savings Deposit Rate 5.30 0.40 0.51 0.71 0.23 0.44 0.55 0.76 0.24 0.57 0.67 0.88 0.26 0.53 0.64 0.85 0.25 0.42 0.54 0.73 0.23 0.29 0.37 0.56 0.18 0.21 0.30 0.48 0.14 0.17 0.24 0.40 0.12 5.30 5.31 5.33 5.38 5.38 5.38 5.38
5.38 0.14 0.19 0.30 0.11
5.38 0.14 0.20 0.32 0.11
0.48 0.69 0.99 0.31 0.66 0.83 1.25 0.32 0.94 1.39 1.85 0.34 0.75 1.09 1.57 0.33 0.49 0.59 0.90 0.26 0.29 0.33 0.62 0.25 0.94 1.02 2.17 2.22 3.40 3.45 2.66 2.76 1.15 1.32 0.45 0.70 1.50 1.62 1.79 3.38 3.56 3.77 5.10 5.19 5.28 5.26 5.30 5.26 2.69 2.93 3.05 0.34 0.70 1.13
Finance Companies 2 Fixed Deposit Rate 3-month 6-month 12-month Savings Deposit Rate
0.22 0.27 0.54 0.25
0.16 0.23 0.50 0.22
0.16 0.24 0.48 0.17
0.20 0.28 0.53 0.17
Interbank Rate 3 1-month 3-month
0.38 0.57
0.30 0.41
0.31 0.38
0.31 0.38
US$ SIBOR 1-month 3-month 6-month
0.28 0.35 0.52
0.24 0.34 0.51
0.24 0.43 0.69
0.20 0.29 0.47
1 Average of 10 leading banks.
2 Average of all finance companies.
3 Closing offer rates quoted by money brokers.
Note: Interest rates for banks (except for Prime Lending Rate) and finance companies refer to average of end of month rates.
B.1
FINANCIAL STRUCTURE: NUMBER OF FINANCIAL INSTITUTIONS IN SINGAPORE
End-March 115 5 110 23 37 50 (398) 160 110 50 3 (39) 51 138 55 32 0 51 61 61 57 0 5 60 63 28 28 55 56 140 149 153 61 27 5 60 62 48 48 49 (39) (39) (39) (39) 49 151 59 25 5 62 65 3 3 3 3 47 47 48 47 106 104 106 111 112* 49 3 (39) 50 158 62 27 6 63 66 153 151 154 158 161* (396) (397) (399) (408) (409)* (421) 162 117 45 3 (39) 46 158 64 26 6 62 63 47 45 43 41 40 42 35 34 36 42 41 46 24 24 24 24 27 25 106 103 103 107 108 113 114 26 50 38 (428) 163 117 46 3 (39) 47 157 63 28 6 60 64 5 5 5 6 6 7 6 111 108 108 113 114 120 120
2004
2005
2006
2007
2008
2009
2010
2011
2012 123 6 117 26 52 39 (432) 165 120 45 3 (39) 46 164 70 29 6 59 67
2013 123 6 117 27 53 37 (425) 161 120 41 3 (39) 42 168 72 28 6 62 69
Banks
Local 1
Foreign
Full banks
Wholesale banks 2
Offshore banks
(Banking offices including head offices and main offices)
Asian Currency Units
Banks
Merchant banks
Finance Companies
(Finance companies offices including head offices)
Merchant Banks
Insurance Companies
Direct insurers
Professional reinsurers
Authorised reinsurers
Captive insurers
Insurance Brokers
End-March 49 49 8 52 163 60 31 26 94 10 13 26 31 35 27 31 34 38 40 1 38 15 16 15 16 16 11 13 14 18 19 91 92 97 110 113 30 33 36 37 37 34 107 19 17 39 7 40 34 38 40 46 50 48 65 72 77 93 90 99 168 171 183 215 221 224 251 98 47 33 118 19 18 40 22 48 56 61 67 69 73 71 67 10 9 10 10 10 10 10 9 67 250 94 50 34 119 20 17 40 23 50 2 3 2 45 42 43 45 36 30 34 36 38 2 9 62 295 106 52 37 158 23 17 38 26 3 51 74 45 42 43 45 36 30 34 36 38
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
Representative Offices
Banks
Merchant banks
Insurance 3
International Money Brokers
Licensed Financial Advisers
Capital Markets Services Licensees
Dealing in Securities
Trading in Futures Contracts
Advising on Corporate Finance
Fund Management
Leveraged Foreign Exchange Trading
Securities Financing
Providing Custodial Services for Securities
Real Estate Investment Trust Management 4
Providing Credit Rating Services 5
Licensed Trust Companies 6
Registered Fund Management Companies 7
1 Local banks comprise 6 full banks.
2 Previously known as restricted banks.
3 Data is unavailable for the period between 2004 and 2009.
4 Regulation of real estate investment trust management came into effect on 1 August 2008.
5 Regulation of credit rating services came into effect on 17 January 2012.
6 Regulation of trust companies came under the purview of MAS when the Trust Companies Act came into effect on 1 February 2006.
7 Registration of fund management companies commenced under an enhanced regulatory regime which came into effect on 7 August 2012.
Revised Figures
C.1
COMMERCIAL BANKS: ASSETS AND LIABILITIES
108 MAS Annual Report 2012/2013 2005 2006 2007 2008 2009 2010 2011 2012 S$ Million March 2013 1,349.4 7,466.1 267.6 133,505.2 39,004.2 51,023.1 43,477.9 70,228.9 60,626.7 43,750.4 16,876.3 9,602.3 183,109.4 5,308.1 29,296.0 194,597.6 6,160.2 38,670.5 233,393.9 9,035.2 51,389.2 272,175.4 9,489.7 65,112.3 281,296.8 11,308.5 58,598.7 322,743.8 20,050.4 78,411.4 1,665.4 8,802.0 98.2 183,989.2 51,554.4 63,476.1 68,958.7 80,627.0 67,707.6 50,738.3 16,969.3 12,919.4 1,772.9 9,530.4 0.0 194,828.8 59,924.1 58,945.9 75,958.8 91,943.8 78,349.4 59,934.1 18,415.3 13,594.3 1,739.8 13,466.0 0.0 217,089.8 52,572.1 73,134.5 91,383.2 98,715.0 84,826.2 66,696.1 18,130.1 13,889.0 2,026.8 13,999.9 0.0 227,923.9 57,188.2 87,208.0 83,527.7 122,968.0 98,742.6 81,318.8 17,423.8 24,225.6 2,219.9 15,878.7 0.0 232,272.3 77,972.8 69,152.1 85,147.4 130,081.3 107,526.2 84,853.4 22,672.8 22,555.2 2,796.4 17,815.3 9.9 216,223.0 58,857.6 62,125.1 95,240.3 137,711.5 118,078.3 91,417.5 26,660.9 19,633.2 420,455.5 44,582.2 60,799.8 2,756.0 19,503.3 201.8 184,902.7 44,059.5 44,061.6 96,781.5 153,318.7 129,130.6 98,388.0 30,742.6 24,188.2 490,706.5 56,292.0 59,611.4 2,639.8 21,189.9 200.0 176,412.9 40,121.3 39,360.6 96,931.0 164,448.3 140,177.8 106,671.4 33,506.3 24,270.5 517,743.0 62,631.6 62,305.7 38,161.7 223,718.0 676.7 120,849.1 23,010.9 67,842.2 29,996.0 620.8 41,196.2 425,222.5 508,449.9 582,859.0 39,017.4 272,462.6 319.0 146,468.4 19,879.9 78,840.4 47,748.1 998.3 49,184.3 41,436.9 314,985.8 65.7 165,520.8 17,225.7 95,867.3 52,427.8 1,254.3 59,595.5 51,315.7 347,507.4 18.0 184,405.1 18,283.9 92,313.0 73,808.1 904.0 84,148.2 668,298.4 54,967.6 391,495.1 0.0 176,394.4 13,869.4 113,588.1 48,936.9 1,023.4 82,933.6 706,814.2 62,441.7 433,757.8 20.0 188,564.9 14,189.7 119,350.8 55,024.4 1,096.3 95,726.8 781,607.4 64,845.4 483,110.3 175.0 226,427.6 9,900.5 147,478.7 69,048.4 1,495.7 79,757.4 855,811.5 66,305.4 518,840.7 292.0 244,892.2 12,088.7 162,746.8 70,056.7 1,778.4 78,891.7 911,000.4 69,096.2 536,539.8 316.8 254,799.4 14,989.7 163,003.4 76,806.3 1,972.7 82,214.8 944,939.7
End of Period
2004
Assets Cash in hand Balances with MAS S$NCDs held Amounts due from banks In Singapore ACUs Outside Singapore Investments In Singapore Government securities Others Outside Singapore Loans and advances to non-bank customers of which bills financing Fixed and other assets
1,400.7 6,775.0 300.5 113,856.1 32,615.8 42,998.9 38,241.4 68,217.7 60,176.8 45,057.5 15,119.3 8,040.8
179,088.6 5,544.8 28,598.1
Liabilities Paid-up capital and reserves Deposits of non-bank customers S$NCDs issued Amounts due to banks In Singapore ACUs Outside Singapore Bills payable Other liabilities
35,933.0 206,176.3 815.5 114,953.7 18,815.1 71,774.1 24,364.5 521.1 39,837.2
Total Assets/Liabilities
398,236.7
C.2
COMMERCIAL BANKS: LOANS AND ADVANCES BY INDUSTRIAL CLASSIFICATION
End of Period 293.0 10,108.0 23,031.1 61,954.6 19,885.2 4,327.0 21,993.1 32,482.3 9,035.3 183,109.4 194,597.6 233,393.9 11,237.9 14,458.1 25,060.6 272,175.4 32,318.3 35,070.9 37,872.3 23,805.6 31,360.4 33,506.1 6,297.1 9,129.8 9,211.7 10,612.3 32,465.3 39,476.3 24,208.0 281,296.8 20,059.0 22,269.0 24,861.6 23,357.4 63,345.1 73,139.1 79,587.0 91,429.5 112,381.3 30,982.9 9,018.1 37,984.6 42,396.1 25,087.2 322,743.8 26,345.5 37,508.9 50,006.6 48,940.6 53,593.9 10,863.2 10,225.8 11,786.1 10,547.3 10,917.6 19,023.5 67,304.4 131,106.5 48,809.6 11,883.2 55,550.9 52,669.8 32,387.8 420,455.5 325.9 232.1 283.2 260.3 382.2 1,719.7
2004
2005
2006
2007
2008
2009
2010
2011
2012 2,104.3 27,166.3 78,704.0 152,003.0 57,349.8 13,089.2 64,895.1 60,451.0 34,943.8 490,706.5
S$ Million March 2013 2,015.4 34,596.8 83,163.8 156,543.2 63,662.7 14,134.0 65,925.8 61,413.4 36,288.0 517,743.0
Agriculture, mining and quarrying
212.5
Manufacturing
9,796.9
Building and construction
23,548.8
Housing and bridging loans
58,887.1
General commerce
18,893.8
Transport, storage and communication
3,956.8
Non-bank financial institutions
22,136.9
Professional and private individuals
32,571.8
Others
9,083.9
Total
179,088.6
C.3
COMMERCIAL BANKS: TYPES OF LOANS AND ADVANCES TO NON-BANK CUSTOMERS
End of Period 11,790.0 5,308.1 5,095.7 160,915.6 183,109.4 194,597.6 233,393.9 272,175.4 281,296.8 172,248.7 207,489.8 245,917.2 255,140.9 288,400.2 322,743.8 5,407.2 6,431.8 6,504.0 4,874.3 5,374.6 6,160.2 9,035.2 9,489.7 11,308.5 20,050.4 10,781.5 10,437.2 10,264.5 9,973.0 8,918.7 8,591.8 44,582.2 6,727.3 360,554.2 420,455.5
2004
2005
2006
2007
2008
2009
2010
2011
2012 9,322.5 56,292.0 7,429.4 417,662.6 490,706.5
S$ Million March 2013 9,462.1 62,631.6 7,854.5 437,794.9 517,743.0
Overdrafts
13,562.9
Bills discounting
5,544.8
Trust receipts
4,649.5
Term loans and others
155,331.4
Total
179,088.6
C.4
COMMERCIAL BANKS: TYPES OF DEPOSITS INCLUDING S$NCDS
End of Period 35,140.1 118,496.4 69,306.2 409.2 775.4 224,127.3 272,683.4 315,051.6 347,525.4 391,495.2 1,060.3 988.5 726.6 881.3 220.8 65.7 18.0 0.0 20.0 996.3 433,777.8 71,760.9 86,496.0 109,033.5 129,995.1 146,802.5 158,168.3 175,421.2 175,646.9 179,571.8 185,564.8 197,609.5 163,782.5 165.0 1,585.1 483,275.4 41,473.1 52,080.2 62,100.4 81,047.0 100,394.2 120,133.3
2004
2005
2006
2007
2008
2009
2010
2011
2012 130,965.7 213,657.9 171,785.5 90.2 2,431.7 518,931.0
S$ Million March 2013 139,698.0 213,665.7 180,356.7 116.8 2,819.3 536,656.5
Demand
32,775.4
Fixed
99,829.5
Savings
72,938.3
S$NCDs (net)
515.0
Others
633.0
Total
206,691.2
C.5
COMMERCIAL BANKS: LIQUIDITY POSITION
Period Average 216,346.6 242,434.1 289,744.0 343,846.6 373,193.1 413,313.7 465,704.0
2004
2005
2006
2007
2008
2009*
2010*
2011*
2012 515,360.4
S$ Million 1st Qtr 2013 550,475.1
112 MAS Annual Report 2012/2013 38,238.1 52,889.6 14,651.5 24.4 22.1 22.5 19.1 18.9 10,616.9 13,388.6 29,508.3 33,654.0 31,166.8 17.2 53,597.5 65,088.2 65,787.4 70,449.1 71,212.6 42,980.6 51,699.6 36,279.1 36,795.0 40,045.8 40,821.9 77,987.9 37,165.9 16.7 42,729.4 85,250.6 42,521.2 16.5 47,641.5 92,769.2 45,127.7 16.9
Liabilities Base
202,741.5
Liquid Assets
(a) Minimum Requirement
36,091.2
(b) Total Actual Liquid Assets
52,340.0
(c) Free Liquid Assets (b) - (a)
16,248.8
Liquidity Ratios
25.8
Revised Figures
D.1
FINANCE COMPANIES: ASSETS AND LIABILITIES
End of Period
2004
2005
2006
2007
2008
2009
2010
2011
2012
S$ Million March 2013
Assets 187.6 455.1 455.1 0.0 7,869.7 1,583.3 2,467.6 0.0 3,818.7 827.3 105.2 126.2 167.9 123.0 1,008.0 1,277.7 1,456.9 4,045.1 5,699.4 5,399.9 4,504.3 1,453.7 116.7 0.0 0.0 0.0 0.0 2,245.8 2,713.1 2,755.6 2,361.3 1,681.3 1,767.1 1,587.6 1,226.4 7,972.2 10,179.7 9,743.1 8,092.0 8,058.2 1,485.5 2,069.9 0.0 4,502.8 1,259.3 106.0 0.0 0.0 0.0 0.0 0.0 757.1 881.7 988.5 1,809.4 1,885.0 757.1 881.7 988.5 1,809.4 1,885.0 1,176.2 1,176.2 0.0 9,460.2 1,517.1 2,037.7 0.0 5,905.4 1,161.9 115.1 203.1 274.9 274.8 220.1 215.1 251.9 318.0 1,810.1 1,810.1 0.0 11,311.5 1,402.8 2,089.9 0.0 7,818.8 1,414.7 113.1 322.6 1,577.8 1,577.8 0.0 11,499.6 1,373.7 2,073.1 0.0 8,052.8 1,556.2 101.1
Reserves with MAS
160.5
Deposits with banks and other financial institutions
460.7
Banks
453.3
Other institutions
7.4
Loans and advances
6,878.9
Housing loans
952.4
1,658.4 6,365.5 6,240.4 121.6 3.5 685.4 735.7 9,444.9 10,066.6 619.5 603.7 6.0 7.7 256.9 754.5 12,781.8 108.9 140.0 7,035.3 9,939.5 7,150.3 10,087.2 1,693.1 1,683.3 1,713.0 9,975.7 9,799.7 162.4 13.6 134.9 762.8 12,586.4 1,824.9 9,111.0 8,861.1 238.2 11.7 97.5 658.5 11,691.9
Hire purchase
2,364.8
Lease finance
0.0
Others
3,561.7
Securities and equities
709.4
Other assets
98.9
Liabilities 1,926.2 8,891.4 8,614.6 266.6 10.2 79.6 626.4 11,523.6 1,999.2 9,481.0 9,218.7 252.7 9.7 45.6 639.5 12,165.3 2,104.8 12,347.6 11,909.9 220.9 216.8 22.6 492.5 14,967.5 2,120.0 12,415.2 11,945.4 231.0 238.8 20.3 501.7 15,057.3
Capital and reserves
1,442.8
Deposits
5,667.6
Fixed
5,514.1
Savings
145.8
Others
7.7
Borrowings
321.3
Other liabilities
876.8
8,308.5
E.1
MERCHANT BANKS: CONSOLIDATED ASSETS AND LIABILITIES 1
End of Period
2004
2005
2006
2007
2008
2009
2010
2011
2012
114 MAS Annual Report 2012/2013 24,548.3 665.3 14,189.8 9,693.2 26,675.0 11,209.1 2,412.7 2,133.9 3,579.3 5,571.5 6,091.7 15,650.2 21,072.0 13,182.7 24,484.6 27,562.0 28,157.1 21,754.6 23,451.1 25,976.8 36,100.0 5,079.2 16,862.8 14,912.3 16,978.0 13,684.7 15,251.7 15,049.0 20,688.9 13,853.3 7,153.9 5,097.9 771.4 660.5 1,262.2 1,488.4 2,254.7 32,683.2 36,261.8 32,093.5 22,327.0 22,604.2 22,815.1 2,567.3 4,615.0 15,632.8 29,095.7 28,618.0 7,322.1 21,646.5 3,170.6 5,300.3 13,175.6 26,832.3 38,303.3 5,628.8 20,861.4 3,134.7 5,417.2 12,309.5 27,670.4 39,657.4 6,062.6 8,374.1 29,471.5 904.5 13,730.9 14,836.2 23,036.8 3,962.7 64,845.1 78,029.3 5,231.8 6,523.2 89,070.2 28,859.0 36,904.2 16,347.7 15,400.7 17,851.1 19,614.0 1,635.2 1,463.7 35,834.0 36,478.5 35,698.1 530.7 17,419.1 17,748.2 22,781.3 5,679.7 72,602.3 8,104.5 9,164.4 8,443.2 8,855.7 37,963.7 3,265.6 13,138.0 21,560.0 23,824.0 5,711.0 76,354.4 9,510.2 51,264.3 3,101.8 22,920.9 25,241.5 21,249.1 7,736.8 89,760.3 9,983.5 46,928.5 585.8 23,772.5 22,570.2 22,623.4 8,315.6 87,851.0 12,168.1 55,045.1 615.2 22,413.9 32,016.0 17,741.8 7,456.0 92,411.0 12,538.7 56,928.5 668.7 25,275.3 30,984.4 17,163.7 7,620.9 94,251.7
Assets
Amounts due from banks
25,718.7
In Singapore
1,394.9
14,372.7
Outside Singapore
9,951.2
Loans and advances to non-bank customers
18,693.0
11,991.1
Other assets
2,842.0
Liabilities
7,636.0
Amounts due to banks
27,320.4
In Singapore
1,225.9
12,226.7
Outside Singapore
13,867.8
Borrowings from non-bank customers
20,406.1
Other liabilities
3,882.4
59,244.8
1 Data are derived from the consolidation of merchant banks domestic and Asian dollar operations.
E.2
MERCHANT BANKS: ASSETS AND LIABILITIES OF DOMESTIC UNIT OPERATIONS 1
End of Period
2004
2005
2006
2007
2008
2009
2010
2011
2012
Assets 4,034.7 664.2 2,900.6 469.9 685.2 1,137.6 299.8 397.2 1,170.7 1,469.6 769.0 1,864.0 1,641.2 1,221.1 3,067.1 715.1 1,138.5 781.7 845.6 1,917.8 3,024.9 601.1 510.6 615.8 998.4 1,051.3 1,263.2 3,121.9 3,112.0 3,062.9 2,988.7 2,368.8 770.6 659.6 1,261.8 1,488.4 2,254.6 2,567.0 2,539.6 1,611.9 1,660.0 3,043.1 715.6 4,403.2 4,387.4 5,323.1 5,528.5 5,886.6 6,718.5 7,564.1 3,109.2 2,894.1 1,560.8 1,738.0 2,663.9 792.8 7,904.4 3,126.9 3,337.6 1,439.9 1,742.1 2,823.3 985.1
Amounts due from banks
4,970.6
In Singapore
1,393.0
3,273.4
Outside Singapore
304.2
Loans and advances to non-bank customers
688.4
745.1
2,613.4 2,842.4 904.5 1,272.3 665.6 237.8 463.7 6,157.3 7,379.6 8,337.8 643.8 1,126.1 365.5 521.9 728.3 852.7 1,637.5 341.6 1,543.2 8,795.5 1,873.2 1,642.6 1,482.4 1,635.2 1,449.3 527.9 4,236.7 3,944.6 3,647.8 2,133.6 2,745.3 3,262.9 3,138.4 6,039.7 1,340.2 1,948.4 2,751.1 318.2 713.9 10,210.2
Other assets
326.9
Liabilities 3,564.6 6,453.8 649.2 2,796.1 3,008.5 360.9 1,051.1 11,430.4 3,219.1 7,439.2 553.3 3,462.1 3,423.8 457.7 1,021.2 12,137.2 4,025.9 7,318.0 578.5 3,050.0 3,689.5 395.3 1,019.5 12,758.7 4,106.5 7,914.7 621.2 3,928.1 3,365.4 303.3 1,130.3 13,455.0
3,529.3
Amounts due to banks
2,301.8
In Singapore
831.0
1,103.8
Outside Singapore
367.0
Borrowings from non-bank customers
435.8
Other liabilities
464.0
6,731.0
1 Corporate financial advisory services, underwriting activities and operations in the gold market are not reflected in the data
F.1
INSURANCE INDUSTRY: ASSETS & PREMIUMS
2004
2005
2006
2007
2008
2009
2010
2011
2012
116 MAS Annual Report 2012/2013 102,428.4 94,324.6 6,070.0 2,033.8 1,739.3 1,957.3 1,904.6 2,265.9 2,479.7 6,622.5 7,960.1 8,655.2 9,950.4 10,827.6 105,060.6 118,860.0 104,487.9 123,585.0 136,028.0 113,422.4 128,777.4 115,047.7 135,801.3 149,335.3 161,114.8 143,019.7 15,277.2 2,817.9 174,860.1 156,802.6 15,022.1 3,035.4 174,821.1 159,273.0 15,548.1 N.A. 5,330.7 2,346.7 2,984.0 3,095.4 3,483.5 3,866.8 4,495.4 2,385.9 2,621.9 2,962.5 2,940.8 5,481.3 6,105.4 6,829.3 7,436.2 8,580.0 3,230.6 5,349.4 9,820.4 3,423.6 6,396.8 10,416.5 3,626.7 6,789.8 2,558.9 1,048.9 1,510.0 6,839.8 982.9 5,354.3 263.1 377.4 402.9 6,975.8 9,031.7 868.8 1,121.9 1,459.2 8,038.2 554.2 7,181.5 7,660.8 8,347.5 9,719.1 1,840.7 6,501.6 189.4 11,374.9 3,014.8 7,276.7 152.2 12,412.7 2,466.4 7,253.4 168.2 13,663.6 2,453.7 6,423.6 171.1 14,043.6 694.5 1,404.7 4.4
Total Assets of Insurance Industry (End Period)
86,552.9
Direct Insurers
79,822.9
Professional Reinsurers
5,202.7
Captive Insurers
1,527.3
General Business: Gross Premiums 1
Total General Business
4,902.6
Domestic Business
2,151.3
Offshore Business
2,751.3
Life Business: Premiums
Premiums in Force (End Period)
5,869.6
New Business Premiums
Annual Premium Policies
549.8
Single Premium Policies
Life Insurance
6,077.0
Annuity
237.7
Figures for March 2013 do not include captives and marine mutual insurers.
N.A: Not available
G.1
NON-BANK FINANCIAL INSTITUTIONS: CENTRAL PROVIDENT FUND BOARD
2004
2005
2006
2007
2008
2009
2010
2011
2012
S$ million 1st Qtr 2013**
Excess Of Contributions Over Withdrawals (During Period) 4,238.3 16,105.1 11,866.8 7,364.3 2,440.3 903.5 1,158.7 3,675.4 10,091.7 3,844.1 115,362.2 119,787.5 125,803.8 136,586.9 118,918.0 128,626.5 141,325.5 151,307.1 4,114.7 4,432.1 5,651.4 1,574.4 17,874.2 14,167.3 15,408.0 6,276.3 157,446.7 166,804.0 . 3,926.8 4,228.0 5,455.1 6,092.6 2,078.3 1,604.3 1,078.8 846.0 996.3 1,076.7 1,302.9 1,476.4 1,645.4 537.8 6,709.8 18,765.9 6,978.9 176,142.0 185,888.0 3,028.0 3,081.0 2,799.8 2,622.9 2,628.9 8,355.0 5,867.9 5,847.0 5,836.5 4,852.7 14,457.6 11,629.9 11,028.5 10,781.8 9,664.8 16,547.1 18,185.0 20,293.6 20,186.2 22,039.0 24,672.7 10,487.9 6,810.9 2,909.4 1,792.1 -1,024.5 7,472.7 19,935.0 7,792.7 197,245.5 207,545.5 2,089.5 6,555.1 9,265.1 9,404.4 12,374.2 14,184.8
4,959.0
14,321.6 26,095.5 11,773.9 7,993.7 3,112.2 1,840.4 -1,172.4 8,290.6 19,119.1 8,646.9 219,037.6 230,157.7
4,769.2 8,188.5 3,419.3 1,935.0 952.8 506.4 25.1 2,233.6 5,856.0 2,318.4 229,946.3 237,160.5
Members Contributions
15,320.1
Withdrawals *
10,361.1
Approved Housing Schemes 1
6,517.0
Under Section 15 2
2,272.6
Medical Schemes 3
779.7
Others
791.8
Interest Credited to Members Balances (During Period)
3,375.3
Advanced Deposits with MAS (During Period) 4
11,624.5
Interest Earnings from Investments (During Period)
3,523.5
Holdings of Government Securities (End Period) 5
108,462.4
Members Balances (End Period)
111,873.8
Source: Central Provident Fund Board
Includes refunds and transfers to Reserve Account/General Moneys of the Fund
1 Housing schemes include Public Housing and Residential Properties Schemes.
2 Section 15 of the CPF Act allows withdrawals to be made on any of the following grounds: a) member having reached the age 55 years; b) leaving Singapore and West Malaysia; c) physical incapacity; d) unsound mind; e) death; and f) Malaysian citizen (leaving Singapore).
3 Medical Schemes include Medisave, MediShield, Private Medical Insurance and ElderShield Schemes.
4 Deposits placed with MAS during the year excluding: a) interest on bonds & interest on Advance Deposits retained as deposits by MAS; and b) conversion and redemption of Government Bonds.
5 Excludes advance deposits with MAS.
** Provisional
H.1
DOMESTIC CAPITAL MARKET: NET FUNDS RAISED IN THE DOMESTIC CAPITAL MARKET
2004 13,056.1 28,299.8 19,946.1 35,930.9 38,097.7 41,201.3 60,383.4 3,200.2 22,837.3 17,526.1 16,793.2 22,667.4 41,075.1 49,609.3
2005
2006
2007
2008
2009
2010
2011
2012 39,864.3 50,826.4
S$ Million 1st Qtr 2013 19,022.4 19,164.5
118 MAS Annual Report 2012/2013 16,700.0 6,899.8 7,656.1 700.0 1,275.0 1,415.0 500.0 -1,271.0 -1,374.8 16,222.3 13,526.1 15,164.2 3,555.8 9,708.4 12,699.0 17,121.3 13,090.3 21,022.5 21,898.7 21,180.0 36,589.0 20,194.4 18,402.4 665.0 23,815.5 21,593.9 19,280.2 17,595.0 25,515.5 22,110.9 18,284.3 18,380.0 3,774.9 11,289.6 5,822.4 9,100.0 11,680.0 6,916.8 2,783.5 1,979.7 20,010.3 5,074.5 14,935.8 44,746.4 40,795.0 17,332.7 8,422.0 25,754.7 29,986.7 17,940.2 12,046.5 75,474.2 2,761.0 8,134.7 1,317.8 6,709.6 7,761.3 7,805.9 5,538.6 3,365.0 935.4 15,494.3 8,804.0 6,690.3 42,859.4 11,840.1 22,650.2 9,839.0 24,452.8 3,209.9 17,216.2 4,026.8 15,320.5 6,816.6 8,503.9 56,566.5 12,673.4 6,744.4 2,143.4 3,785.7 25,880.7 17,793.0 8,087.7 61,221.5 16,887.8 10,420.2 3,834.8 2,632.8 24,800.7 15,797.0 9,003.7 82,763.6 6,019.8 2,315.1 1,438.3 2,266.4 32,780.8 26,708.0 6,072.8 78,664.9 3,332.0 1,841.4 63.3 1,427.3 6,286.5 4,610.0 1,676.5 28,640.9
A Net funds raised by Government
14,965.8
1) Gross issue of Government securities 1
31,102.2
Less:
Redemption of Government securities
17,240.0
Conversion from accumulated advance deposits
7,712.2
2) New advance deposits
8,315.8
3) Net issues of statutory boards securities
500.0
B New capital raised by the private sector
5,987.2
1) Public issues of shares
3,942.7
2) Rights issues
1,110.6
3) Private placements of listed shares
933.9
C Issues of debt securities
21,237.1
1) Listed bonds, debentures and loan stocks 2
6,399.5
2) Unlisted bonds 3
14,837.6
Total net funds raised (A+B+C)
42,190.1
1 Government securities excluding treasury bills.
2 Singapore dollar-denominated bonds listed on the Singapore Exchange (SGX).
3 This includes bonds that are not listed on the SGX but listed on other exchanges.
I.1
ASIAN DOLLAR MARKET: ASSETS AND LIABILITIES
End of Period
2004
2005
2006
2007
2008
2009
2010
2011
2012
US$ Million March 2013
Assets 120,865.5 389,485.1 40,766.4 29,102.0 319,616.7 3,367.2 97,659.5 119,335.2 173,972.9 198,635.4 187,871.2 5,790.8 2,520.4 1,052.5 1,187.7 1,111.3 200,215.0 338,985.2 412,665.5 379,908.9 338,106.5 355,413.7 43,628.2 53,610.7 54,620.3 41,678.4 53,762.1 51,409.5 66,398.3 64,140.5 80,941.5 92,715.5 434,022.9 532,674.6 498,669.6 460,726.4 501,891.4 528,823.2 113,361.8 53,383.9 362,077.5 686.1 177,209.5 139,499.6 197,823.1 214,381.9 219,614.4 268,081.7 312,814.0 340,914.0 562,970.6 133,171.6 53,768.7 376,030.3 1,745.6 187,633.5 358,584.4 543,991.1 130,956.9 56,501.0 356,533.2 2,044.8 183,956.9
Loans to non-bank customers
93,494.2
Interbank funds
385,302.2
In Singapore
43,932.1
Inter-ACU
31,428.3
Outside Singapore
309,941.8
NCDs held
3,187.4
Other assets
99,578.7
162,834.2 394,080.5 37,337.3 29,067.8 327,675.4 2,952.4 51,510.2 611,377.4 698,648.5 906,991.0 67,219.2 87,393.7 4,733.1 3,652.1 1,593.9 125,292.9 912,739.4 317,766.8 436,579.6 406,240.9 42,971.6 53,670.1 54,848.7 49,139.6 50,438.6 62,600.9 409,878.0 540,688.3 523,690.5 216,818.1 275,256.9 262,162.1 269,370.2 502,232.6 87,208.3 41,778.1 373,246.2 1,416.2 96,380.6 869,399.6 273,980.3 584,218.2 79,206.4 53,812.3 451,199.5 1,780.4 111,320.5 971,299.4 296,376.6 599,568.3 77,629.4 53,603.0 468,335.9 1,686.8 121,901.1 1,019,532.8 327,854.6 628,117.9 75,466.9 53,934.8 498,716.2 3,572.8 133,718.6 1,093,263.8 333,685.2 610,742.4 57,858.4 56,425.6 496,458.5 4,355.7 139,793.8 1,088,577.2
Liabilities
Deposits of non-bank customers
150,354.2
Interbank funds
379,900.0
In Singapore
34,771.1
Inter-ACU
31,457.9
Outside Singapore
313,671.1
NCDs issued
2,679.4
Other liabilities
48,628.9
581,562.5
I.2
ASIAN DOLLAR MARKET: MATURITY TRANSFORMATION BY ASIAN CURRENCY UNITS
End of Period
2004
2005
2006
2007
2008
2009
2010
2011
2012
US$ Billion March 2013
120 MAS Annual Report 2012/2013 -89.5 27.3 25.7 37.8 61.6 83.9 83.4 73.0 79.6 29.1 46.8 50.8 60.4 67.2 19.1 27.0 21.7 15.6 28.7 -104.5 -162.6 -169.1 -160.8 -178.5 -178.1 33.3 58.4 75.3 -154.3 20.4 56.9 67.8 -160.0 19.9 53.9 69.7 427.5 48.5 41.4 59.9 87.2 117.7 117.4 50.6 71.7 80.9 85.0 105.8 44.4 55.3 52.4 42.6 479.2 603.3 570.3 561.6 621.9 54.4 101.9 122.4 642.1 68.0 109.5 126.8 701.1 65.2 115.6 129.9 691.4 72.2 111.8 131.2 517.0 21.2 15.7 22.1 25.6 33.8 21.5 24.9 25.3 28.3 583.7 765.9 739.4 30.7 30.1 34.0 722.4 27.0 24.6 32.8 800.4 25.7 34.7 42.8 820.2 34.7 51.1 51.5 855.4 44.8 58.7 62.1 851.4 52.3 57.9 61.5
Net Position 1
Up to 6 months
-74.1
Over 6 months to 1 year
20.1
Over 1 to 3 years
27.2
Over 3 years
28.8
Claims 1
Up to 6 months
415.5
43.5
Over 1 to 3 years
40.6
Over 3 years
48.7
Liabilities 1
Up to 6 months
489.6
23.4
Over 1 to 3 years
13.4
Over 3 years
19.9
1 From 2004 onwards, data exclude those claims or liabilities with unallocated maturity periods. Therefore the sum of all the maturity categories for claims may not be equal to the sum of all the maturity categories for liabilities.
GLOSSARY
GLOSSARY
AML/CFT AMRO ASEAN ASEAN+3 AUM BCBS BIS CBRC CCWG CMG CMIM COE CPI CPSS CRAs
Anti-Money Laundering & Countering the Financing of Terrorism ASEAN+3 Macroeconomic Research Office Association of Southeast Asian Nations ASEAN plus China, Japan, South Korea Assets Under Management Basel Committee on Banking Supervision Bank for International Settlements China Banking Regulatory Commission The Contract Certainty Working Group Crisis Management Group Chiang Mai Initiative Multilateralisation Certificate of Entitlement Consumer Price Index Committee on Payment and Settlement Systems Credit Rating Agencies
ECB EFM EMEAP FATF FDSP FHC FMC FSB FX G20 G3 GDP IAD IAIA
European Central Bank Exempt Fund Manager Executives Meeting of East Asia-Pacific Central Banks Financial Action Task Force Financial District Security Programme Financial Holding Company Fund Management Company Financial Stability Board Foreign Exchange Group of Twenty Group of Three Gross Domestic Product Internal Audit Department International Association of Insurance Supervisors
ICBG IMF IMFC IOSCO IT
Inter-Central Bank Games International Monetary Fund International Monetary and Financial Committee International Organisation of Securities Commissions Information Technology
SAA SEACEN SFEMC SGS SGX SIPs
MAS Service Appreciation Award South East Asian Central Banks Singapore Foreign Exchange Market Committee Singapore Government Securities Singapore Exchange Specified Investment Products Society for Worldwide Interbank Financial Telecommunication United States Dollar Working Committee on Capital Market Development
LTV Loan-to-value MEPS+ MoU NUS MAS Electronic Payment System Memorandum of Understanding National University of Singapore SWIFT US$ / USD WC-CMD
OTC Over-the-counter WOG Whole-of-Government q-o-q SAAR Quarter-on-Quarter Seasonally Adjusted Annualised Rate S$/SGD S$NEER Singapore Dollar Nominal Effective Exchange Rate
THANK YOU
The MAS Annual Report 2012/2013 working committee would like to thank the following colleagues for their invaluable contributions: Banking Department Pearline Yum Capital Markets Intermediaries Department Capital Markets Department Consumer Issues Division Corporate Services Department Economic Surveillance and Forecasting Department Finance Department Financial Centre Development Department Financial Markets Strategy Department General Counsels Office Human Resource Department Information Technology Department Internal Audit Department Yap Sock Hui Revathi Govindasamy Beverly Tan Tan Teck Hau Thum Jie Liang Poon Siok Kheng Marisca Wong Ng Xiang Jing Jo Yeo Hui-Xian Tan Hui Luan Sandeep Shetty Ngoh Eng Eng Angeline Lam Huang Wei Ong Sze Han Siew Sin Yuen Jenny Low Alicia Ling Andrew Tan
Currency Department Thomas Yu External Department Alvinder Singh
Insurance Department Anusha Gunasegaram Macroeconomic Surveillance Department MAS Recreation Club Monetary and Domestic Markets Management Department Prudential Policy Department Risk Management Department Specialist Risk Department Strategic Planning Division
MAS Academy Nicole Koh
Published by Monetary Authority of Singapore Designed and produced by APACHE ART ENTERPRISE Copyright Monetary Authority of Singapore 2013 This annual report is copyright under the Monetary Authority of Singapore. No reproduction without permission. All rights reserved. Monetary Authority of Singapore 10 Shenton Way. MAS Building. Singapore 079117 www.mas.gov.sg
10 Shenton Way MAS Building Singapore 079117 www.mas.gov.sg


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Monetary Authority of Singapore

ANNUAL REPORT 2012/2013

Monetary Authority of Singapore

ROBUST, TRUSTED, AND PURPOSEFUL FINANCIAL CENTRE

ANCHOR OF ECONOMIC AND FINANCIAL STABILITY

MAS Annual Report 2012/2013

VALUED PARTNER ON THE INTERNATIONAL FRONT

ONE MAS: INTEGRATED AND COHESIVE

SERVING THE PUBLIC, ENGAGING STAKEHOLDERS

FINANCIAL STATEMENTS KEY ECONOMIC AND FINANCIAL STATISTICS STATISTICAL ANNEX

EDUCATING CONSUMERS 51 MoneySENSE 51 - Media Outreach 51 - Outreach Through Other Platforms 51

MAS Annual Report 2012/2013

MAS Annual Report 2012/2013

MAS Annual Report 2012/2013

Tharman Shanmugaratnam Chairman

MAS Annual Report 2012/2013

Lim Hng Kiang

Heng Swee Keat

Lawrence Wong Shyun Tsai

MAS Annual Report 2012/2013

Quek See Tiat

Lim Chee Onn

Peter Ong Boon Kwee

Tan Chorh Chuan

Senior Advisor to MAS

Goh Chok Tong

MAS Annual Report 2012/2013

10 MAS Annual Report 2012/2013

MAS Annual Report 2012/2013 11

12 MAS Annual Report 2012/2013

FINANCIAL SUPERVISION Teo Swee Lian

Ong Chong Tee

BANKING & INSURANCE Lee Boon Ngiap

Teo Swee Lian

MONETARY POLICY AND INVESTMENT / FINANCIAL DEVELOPMENT Ong Chong Tee

ECONOMIC POLICY Edward Robinson

MANAGING DIRECTORS OFFICE SPECIAL PROJECTS ADVISOR TO MD Foo-Yap Siew Hong

MONETARY & DOMESTIC MARKETS MANAGEMENT Andrew Khoo

MAS ACADEMY Andrew Khoo

CORPORATE SERVICES Bernard Yeo Executive Director

MAS Annual Report 2012/2013 13

ANCHOR OF ECONOMIC AND FINANCIAL STABILITY

ANCHOR OF ECONOMIC AND FINANCIAL STABILITY

1 External GDP growth is weighted by country shares in Singapores NODX.

16 MAS Annual Report 2012/2013

MAS Annual Report 2012/2013 17

Chart 1: Singapores GDP Growth

18 MAS Annual Report 2012/2013

Chart 2: Contribution to CPI-All Items Inflation

MAS Annual Report 2012/2013 19

Chart 3: Key Macroeconomic Variables and the Monetary Policy Stance

130 125 Index (Q1 2004=100) 120 115 110 105

Modest & Gradual Appreciation

Modest & Gradual Appreciation

Maintain Reduce Slope Re-centre

Increase Slope Slightly & Widen Band

Increase Slope Slightly & Restore Narrower Band

2013 Q1: 4.0%

5 Real GDP Growth 0 2013 Q1: 0.2%

20 MAS Annual Report 2012/2013

MAS Annual Report 2012/2013 21

22 MAS Annual Report 2012/2013

ROBUST, TRUSTED AND PURPOSEFUL FINANCIAL CENTRE