Monday, 16 May 2022

MAS imposes additional capital requirement on DBS Bank for disruption of digital banking services

5 min read

The Monetary Authority of Singapore (MAS) has imposed on DBS Bank Ltd (DBS Bank) an additional capital requirement following the widespread unavailability of DBS Bank’s digital banking services during 23-25 November 2021. MAS has required DBS Bank to apply a multiplier of 1.5 times to its risk-weighted assets for operational risk. This translates to an additional amount of approximately S$930 million in regulatory capital (based on reported financial statements as at 30 September 2021).

MAS noted deficiencies in DBS Bank’s incident management and recovery procedures to restore its digital banking services to a normal state, resulting in the prolonged duration of the disruption.  

MAS has directed DBS Bank to appoint an independent expert to conduct a comprehensive review of the incident, including the bank’s recovery actions. The independent review is also required to assess how a similar incident can be prevented in future. DBS Bank must rectify all shortcomings identified from the review and implement measures to ensure that any future disruption to its digital banking services is resolved quickly and adequately. The additional capital requirement will be reviewed when MAS is satisfied that DBS Bank has addressed the identified shortcomings.

Mr Marcus Lim, Assistant Managing Director (Banking and Insurance), MAS, said, “MAS requires financial institutions to have robust controls and processes to ensure the reliability and resilience of their IT systems and the continuous delivery of essential financial services to their customers. MAS will take appropriate supervisory action against any financial institution that falls short of our regulatory expectations.”

 

Re-disseminated by The Asian Banker

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