Alvin Tan on safeguarding bank deposits
Singapore’s Deposit Insurance Scheme aims to protect small depositors and its adequacy as a safety net can be assessed by looking at the proportion of depositors who are fully insured. The current coverage limit of S$75,000 per depositor per bank, which was raised from S$50,000 in 2019, fully insured 91 per cent of depositors covered under the scheme at the time. With deposit growth since then, the percentage of fully insured depositors has fallen slightly to 89 per cent. Before the recent bank failures in the United States, the Monetary Authority of Singapore (MAS) had concluded its latest regular review of the scheme and aims to present its proposals for public consultation by the end of June. MAS Board Member Alvin Tan said this in Parliament on Monday (May 8) in reply to MPs' questions. He made the point that deposit insurance is not the main way in which Singapore safeguards depositors’ interests. Instead, it focuses on pre-emptive safeguards such as sound regulation, rigorous supervision, proactive cross-border cooperation and effective governance and risk management by banks. This, said Mr Tan, has contributed to MAS’ financial oversight being assessed to be among the best in the world by the International Monetary Fund. He said international regulatory standard-setting bodies will be looking at the implications of the recent banking stresses and MAS will work with other regulators in these reviews to develop any responses needed to improve the resilience of its banking system.
Singapore’s Deposit Insurance Scheme aims to protect small depositors and its adequacy as a safety net can be assessed by looking at the proportion of depositors who are fully insured. The current coverage limit of S$75,000 per depositor per bank, which was raised from S$50,000 in 2019, fully insured 91 per cent of depositors covered under the scheme at the time. With deposit growth since then, the percentage of fully insured depositors has fallen slightly to 89 per cent. Before the recent bank failures in the United States, the Monetary Authority of Singapore (MAS) had concluded its latest regular review of the scheme and aims to present its proposals for public consultation by the end of June. MAS Board Member Alvin Tan said this in Parliament on Monday (May 8) in reply to MPs' questions. He made the point that deposit insurance is not the main way in which Singapore safeguards depositors’ interests. Instead, it focuses on pre-emptive safeguards such as sound regulation, rigorous supervision, proactive cross-border cooperation and effective governance and risk management by banks. This, said Mr Tan, has contributed to MAS’ financial oversight being assessed to be among the best in the world by the International Monetary Fund. He said international regulatory standard-setting bodies will be looking at the implications of the recent banking stresses and MAS will work with other regulators in these reviews to develop any responses needed to improve the resilience of its banking system.
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