Singapore is an international centre for banking and finance and a leading financial services hub in the Asia-Pacific region.
Sound economic fundamentals, a strong regulatory framework, a pro-business environment, and cultural diversity are behind Singapore’s ability to attract international capital and draw many of the world’s biggest financial institutions here.
In terms of competitiveness, Singapore is the No.3 financial centre in the world after London and New York, according to the 2009 Global Financial Centres Index survey commissioned for the City of London.
Banking, foreign exchange, bonds, equities, derivatives, asset management and insurance are among the wide range of products and services offered in Singapore. Risk management, wealth management and private banking have been identified as major growth areas, buoyed by Singapore’s reputation for trust and integrity, as well as the region’s post-millennium economic boom, notably in China and India.
There are 113 commercial banks, 49 merchant banks and 3 finance companies (Monetary Authority of Singapore, 2009). The three local banks -- DBS, UOB and OCBC -- are the three largest banks in Southeast Asia.
Since 1997, the Monetary Authority of Singapore (MAS), Singapore’s central bank, has been taking action to liberalise the banking sector. This has encouraged more competition from foreign banks. Ongoing deregulation has also led to the formation of the Singapore Exchange (SGX), the first integrated cash and derivatives exchange in the Asia-Pacific, with an expanded product range that includes single stock and bond futures, as well as exchange-traded funds. The SGX is one of the largest in Asia, and lists more than 200 global companies. The industry consolidation has helped to make Singapore’s domestic financial sector more robust in the face of global competition.
Singapore also has the fourth largest foreign exchange market in the world after London, New York and Tokyo; the city is the second largest over-the-counter derivatives trading centre in Asia, and a leading commodities derivatives trading hub. With total assets under management of around S$1 trillion, which continues to see steady growth, Singapore is recognised as one of the premier asset management locations in Asia.
Singapore is also a base to many leading names in insurance broking, captive management, risk management, and offshore insurance.
Monetary Authority of Singapore (MAS)
MAS acts as the central bank of Singapore, whose functions include the conduct of monetary policy, the issuance of currency, the oversight of payment systems and serving as banker to and financial agent of the Government. It conducts the integrated supervision of financial services and financial stability surveillance, manages the official foreign reserves of Singapore, and develops Singapore as an international financial centre.
Its objectives also include developing Singapore as a regional leader in wealth management, a global processing centre, and the premier risk management centre for the Asia-Pacific, as well as creating an attractive business environment for financial institutions.
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