Monday, October 04, 2010

Financial Regulation in Singapore

 
My observation
The light touch regulation has been bad for retail investors, both local and overseas, and has given a bad reputation to Singapore.
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6 comments:

yujuan said...

It is very clear to investors where Singapore authorities stand.
So invest with a suspicious mind when a relationship banker, an insurance agent, your stock-broker or whatever rep selling you landbanking or a multi-level marketing agent selling you highly expensixe products is harrasing you.
Don't think our Govt would think in your interest, it is only numbers to make up a financial centre at all costs. No wonder they allow casinos in.

October 04, 2010 12:42 PM
Spur said...

Over the past 12 months, Singapore is quickly gaining the reputation of being the "Switzerland of the East", as even obscure private banks in Switzerland itself is shaking from the onslaught of legal actions, political pressure and ever-prying eyes from the US govt.

Many major European commercial banks and smaller private banks have been moving their private banking operations and proprietary trading activities into S'pore since middle of 2009. The long history of finance and banking between S'pore & Western Europe has made this transition quite easy. Not so easy for US banks due to lack of history and wider cultural moat (ironical as most business philosophy here are US style).

Enterprising ex-brokers or ex-dealers also find it really easy to set up shop in S'pore. Armed with a short list of ultra-high networth clients siphoned off from their previous jobs, these "entrepreneurs" convince their clients that they are able to "hide" their wealth here paying zero or extremely minimal taxes. MAS does not require these financial shops to be licensed in any way as long as less than 30 clients. These ex-brokers are able to live luxurious lives just on 20-25 UHNW clients, earning 1%-2% wrap fees. Many operate from around the Duxton area, Outram, outskirts of Chinatown, Clarke Quay etc, and many have invested in commercial and residential properties in those areas too.

October 04, 2010 1:09 PM
DareToAct said...

Singapore has been 'growing' our economy through quite a bit of regulatory arbitrages. We make it easier for hedge funds to operate here, more tax efficient for individuals and corporations to be based here, less costly to fire employees ... In times of hardships in US and Europe, the governments will be less likely to tolerate these kind of "unfair" plays.

October 04, 2010 3:52 PM
Lye Khuen Way said...

This "light-touch" thinking appeared to be everywhere in our regulations & enforcements since quite a while ago. As with most things, the swing from a firm-heavy handed environment almost always end up at the other extreme end !

That is why, nowadays, we have these catch words " calibrated" , "market subsidy" etc.

October 04, 2010 7:11 PM
Unknown said...

The light touch also allow risky product to be sold as safe to retail investors e.g Minibond, pinnacle notes, High notes etc

October 05, 2010 8:34 AM
Steve Wu said...

A "light touch" approach CANNOT be an excuse for the failure in regulatory duty. The line should have been drawn at misrepresentation and cheating by the perpetrators, covered by existing statutes. With the benefit of comparing with regulators in other jurisdictions over the same issue, MAS has been far off the mark in its handling of the "mini-bond" debacle.

MAS and its leadership must be taken to task for this failure. I still think that a mandamus application is necessary to compel action in this instance.

October 05, 2010 10:08 AM

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