FILE PHOTO: A Standard Chartered Bank logo is displayed on a building in Singapore.
SINGAPORE: The Monetary Authority of Singapore (MAS) will award Standard Chartered Bank (Singapore) additional privileges as a Significantly Rooted Foreign Bank (SRFB), allowing it to operate more places of business.
Standard Chartered is the first bank to qualify as a Significantly Rooted Foreign Bank, MAS said in a news release on Monday (Aug 3).
The authority will also enhance the framework for such banks, which may give those that “substantially exceeds the criteria for significant rootedness in Singapore” additional privileges.
These include the ability to establish a separate subsidiary to develop alternative business models.
The framework was announced in 2012, which allows qualifying full banks that “have become significantly rooted” in Singapore to establish an additional 25 places of business, of which up to 10 may be branches.
Standard Chartered (Singapore) received its qualifying full bank licence in 1999, according to its website.
Significantly Rooted Foreign Banks “are only awarded as part of an overall package negotiated under free trade agreements (FTAs) with these QFBs’ home countries”, said MAS.
“The assessment of significant rootedness is made by MAS on the basis of a range of quantitative and qualitative attributes.”
MORE PLACES OF BUSINESS
Under the revised framework, qualifying banks will now be allowed to establish up to 50 places of business, of which 35 may be branches.
MAS will also “consider granting an additional full bank licence to a Significantly Rooted Foreign Bank that “substantially exceeds the SRFB baseline criteria”.
To determine if a bank substantially exceeds the baseline criteria, MAS will consider additional attributes of rootedness in Singapore, including the following:
- Full subsidiarisation of banking business operations in Singapore
- Significant proportion of global key appointment holders and business heads based in Singapore
- Firm commitments to Singapore’s financial stability and development in the long term
“(The enhanced framework) will enable them to have the same flexibility as Singapore-incorporated banking groups to establish subsidiaries, including with joint-venture partners, to operate new or alternative business models such as a digital-only bank,” MAS said.
“The enhanced SRFB Framework will strengthen the ability of SRFBs to complement the local banks as anchors to Singapore’s financial system.”
These privileges will continue to be offered only under Singapore’s free trade agreements that contain SRFB commitments, MAS added.
