Monetary Authority of Singapore (MAS)

As Singapore’s central bank, MAS works towards maintaining Singapore’s competitiveness as a global financial center. It also prioritizes price stability and promotion of the sound and progressive development of the financial sector. In carrying out these objectives, MAS acts as a banking regulator and supervisor, an insurer of deposits, and an issuer of Singapore currency.

The History of the Monetary Authority of Singapore

In 1970, Singapore passed the MAS Act. This act led to the creation of the organization on January 1, 1971. The government then charged the organization with overseeing all financial and banking activities in Singapore. In fact, the government entrusted it with the ability to serve as an agent and banker of the government.

In 1973, the Singapore government also passed a separate Securities Industries Act. By 1984, MAS had absorbed its functionalities. Additionally, in 1977, the government tasked MAS with regulating the insurance industry and its products. Finally, in 2002, MAS merged with the Board of Commissionaires of Currency but kept its name.

The Role of the Monetary Authority of Singapore

Over the years, the government has repeatedly expanded the powers of MAS. This continued expansion has led to the following functions:

  • A Central bank 
  • A Regulator and supervisor of banks, merchant banks, finance companies, money changers, and securities and futures intermediaries
  • An Insurer of deposits in commercial banks operating in Singapore
  • The manager of official foreign reserves
  • The issuer of currency in Singapore
  • The developer of the financial sector
  • A banker and debt manager for the Government of Singapore

How MAS Regulates the Financial Market

To ensure effective supervision, MAS established a risk-based supervisory framework. Under this framework, MAS assesses the risks posed by each financial institution and then designs supervisory strategies accordingly.

MAS also regulates the insurance industry in Singapore by ensuring that only insurers with sound financial practices are allowed to operate in the country. Additionally, MAS educates consumers on the risks associated with purchasing insurance products.

The Monetary Authority of Singapore manages official foreign reserves by investing in a diversified portfolio of assets. These assets include foreign currencies, gold, and special drawing rights. Finally, MAS intervenes in the foreign exchange market to prevent excessive appreciation or depreciation of the Singapore dollar.

The Main Focus Areas of MAS

Over the years, MAS has studied the global markets and determined the highest risk factors for Singapore commerce. This has led to its selection of five current focus areas:

  1. COVID-19: MAS closely monitors the situation and has taken a series of measures to support the economy. For example, MAS established and extended support for small and medium-sized businesses facing financial hardship due to the pandemic.
  2. Cybersecurity: MAS is working to strengthen Singapore’s cybersecurity infrastructure and raise awareness about cyber threats. It balances its data privacy and security concerns with the need to embrace fintech innovations.
  3. Fintech Regulatory Sandbox: MAS created a regulatory sandbox to allow fintech firms to test their products and services in a controlled environment. This allows the MAS to monitor risks associated with new technologies while promoting innovation.
  4. Anti-Money Laundering: MAS works hard to prevent money laundering and terrorist financing by enhancing supervisory oversight and sharing information with other financial regulators. This currently includes combatting terrorism and levying international sanctions against Russia for the invasion of Ukraine.
  5. Enforcement: MAS has a robust enforcement regime to deter and punish financial crimes. It works closely with the Singapore police and other law enforcement agencies to investigate and prosecute financial crimes.

The Enforcement Powers Granted to MAS

Over the years, enforcement has played an increasingly important role in MAS’s operations. In 2016, it cemented this by creating a dedicated department for this function. Its enforcement efforts currently have three main goals:

  1. Effective deterrence from breaching laws and engaging in misconduct
  2. Early detection of illegal activity and misconduct
  3. Molding how the markets operate and how organizations conduct business

To achieve these and other important goals, this arm of the MAS has levied S$2.59 million in compositions and financial penalties for violations. It has also issued S$150,000 in civil penalties. Additionally, it has taken the following non-monetary actions:

  • 362 supervisory reminders
  • 157 warnings
  • 23 reprimands
  • 20 prohibition orders

How Message Capturing and Archiving Can Help With MAS Compliance

MAS may request communications at any time as part of an investigation. Capturing and archiving solutions record and store communications for future reference and to provide as evidence.

Additionally, message recording and archiving can help organizations meet their e-discovery obligations if they are ever required to provide communications in response to a legal request. This can help them avoid hefty fines or other penalties.

Lastly, managers can use message capturing and archiving to monitor employee communications for compliance purposes. For example, it can help organizations detect and prevent insider trading.

At LeapXpert, our instant message capturing software complies with MAS and other regulations affecting your business worldwide. Book a demo to see it in action.