MAS upbeat on alternative investment space
The Monetary Authority of Singapore (MAS) sees growth opportunities in the alternative investment space in Singapore despite public market downturns in the last year.
Lim Cheng Khai, executive director of the financial markets development department at Singapore’s central bank, says that the stimulus-fuelled market of 2021 has turned “slightly less sanguine”, as total private credit assets under management (AUM) grew 12% to about US$1.4 trillion ($1.86 trillion) in 2022.
Speaking at the Alternatives Investment Management Association (AIMA) Singapore Forum 2023 on March 28, Lim addressed the challenging financial global economic environment of today, saying: “The business environment was fraught with global geopolitical uncertainties, inflationary pressure, and rising interest rates… Enter 2023, and the conditions have gotten even tougher.”
But Lim remains upbeat, noting that the alternative investment industry as a whole has remained resilient.
Singapore’s alternative AUM grew faster than the overall industry AUM, at 30% y-o-y, with hedge funds and PE/VC accounting for two-thirds of the total alternative AUM in Singapore, he says. And as of end-2022, more than half of the top 50 global alternative asset managers and about 40% of the top 50 global hedge fund managers had set up offices here.
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On that note, Lim reiterates that the asset management industry is a key focus of MAS’s asset class strategy. He highlights a few key initiatives in the MAS’s Industry Transformation Map 2025 which are relevant.
These include setting up various fund structures, such as the variable capital company (VCC) and limited partnerships, enabling Singapore to be a fund domiciliation centre of choice, as well as the exploration of potential distributed ledger technology to facilitate the tokenization of financial and real economy assets, and developing environmental, social and governance capabilities to close the emission gap by 2030.
“Within Southeast Asia, US$1 trillion in annual investments is needed per annum to close the emission gap by 2030, while the current investment level is less than US$20 billion per annum. The investment opportunities are thus wide-ranging and yet to be fully tapped,” he says. — Nicole Lim
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MAS calls DBS disruption ‘unacceptable’
The Monetary Authority of Singapore (MAS) has called the March 29 disruption of DBS Bank’s digital banking and payment services “unacceptable”, a year after a similar incident in November 2021.
The financial regulator adds: “DBS has fallen short of MAS’s expectations to maintain high system availability and ensure its IT systems are recovered expeditiously. MAS has instructed DBS to conduct a thorough investigation to establish the root cause of the disruption and submit its investigation findings to MAS. MAS will take the commensurate supervisory actions after gathering the necessary facts.”
On March 29, the bank’s mobile apps faced an interruption of services for around 10 hours. DBS notified MAS in the morning that its customers were “experiencing difficulties logging in to its digital banking services”. The bank said in a statement to Bloomberg that the services “returned to normal” around 5.45pm on the same day.
DBS faced similar difficulties in November 2021, when its system was down for two days, leaving customers unable to log into their accounts through the bank’s digital platforms. Due to the incident, the MAS slapped DBS with an additional capital requirement of around $930 million in regulatory capital to guard against similar risks in February last year. — Felicia Tan
