Singapore Rate-Rigging Censure Poses Burden on Banks

A censure imposed on banks by the Monetary Authority of Singapore for alleged rate manipulation could result in a significate burden on the 20 lenders affected by the move.


The MAS last month censured 20 banks for their involvment in benchmark manipulation following a year-long review of the processes relating to banks’ benchmark submissions. The banks were ordered to set aside as much as S$12 billion ($9.4 billion) at zero interest, pending steps to improve internal controls. ING Groep NV (INGA), Royal Bank of Scotland Group Plc and UBS AG (UBSN) were among the banks at which 133 traders tried to rig the Singapore interbank offered rate, swap offered rates and currency benchmarks.


The banks have taken disciplinary action against traders found to have tried to rig rates, with about three-quarters of them having resigned or been asked to leave their firms, according to the MAS. The traders who are still employed will be subject to disciplinary action by their employers, the regulator said.


Lawrence Wong, an acting minister and board member of the city’s central bank, told Bloomberg News that rate rigging will be made a criminal offense and supervision will be brought under the Monetary Authority of Singapore’s direct oversight.


Wong also bared that banks will be required to report their progress to the authority on a quarterly basis. Lenders who fail to comply with the central bank’s directives will face penalties including fines, Wong said.

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