MAS Confirms Stability Amid Global Financial Turmoil
The Monetary Authority of Singapore (MAS) has assured that the local banking system has “insignificant exposures” to the collapsed Silicon Valley Bank (SVB) and Signature Bank. Both US banks recently failed, triggering volatility in global markets.
In a statement on Monday (Mar 13), MAS highlighted that banks in Singapore are well-capitalised, maintain robust liquidity positions, and perform regular stress tests against interest rate and other financial risks. These factors position the banking system to withstand external shocks.
Key Developments in the US Banking Crisis
US regulators closed SVB on Friday, marking the largest banking failure in the country since the 2008 financial crisis. The bank, known for its focus on financing start-ups, had US$209 billion in assets and approximately US$175.4 billion in deposits at the end of 2022. Signature Bank, a New York-based institution, was similarly shuttered on Sunday, leaving billions in uninsured deposits at risk.
MAS’s Response to Global Financial Instability
Despite the closures, MAS stated that Singapore’s financial markets remain stable, with the Singapore Dollar money market and foreign exchange market continuing to operate smoothly.
The central bank is closely monitoring both the domestic financial system and international developments. It reiterated its readiness to provide liquidity through various facilities to ensure the stability of the financial system and orderly functioning of markets.
MAS is also collaborating with Enterprise Singapore to assess potential impacts on local start-ups, especially those with operations in the US. Initial feedback suggests that the fallout is limited.
Outlook for Singapore’s Financial Stability
MAS and other government agencies are maintaining vigilance, with ongoing monitoring to detect any signs of financial stress. Singapore’s sound and resilient banking system, coupled with its diversified funding base, offers confidence amid the current global financial uncertainty.
