MAS Invites Comments On Proposed Change To Banks' Liquid Assets

Source : Channel NewsAsia, 26 October 2007

The Monetary Authority of Singapore (MAS) is inviting comments to its proposals to change the minimum liquid assets and minimum cash balances kept by banks.

The latest drafts include the feedback it received from a consultation exercise last year to enhance the liquidity risk supervision of banks in Singapore.

To ensure that these banks are better able to manage liquidity stress situations on a timely basis, the central bank is now proposing to streamline the process for drawing down of regulatory reserves.

The changes will continue to allow banks to adopt either a general methodology or a risk-sensitive methodology for determining regulatory liquidity reserves.

Their choice of method may depend on their level of sophistication and liquidity risk management capability.

Details of the proposed changes are available on the MAS website. - CNA/ch