SOVEREIGN DEBT RESTRUCTURING | MASTERCLASS

A deep dive masterclass on sovereign debt restructuring, to be conducted virtually by Asian high yield bond expert Florian Schmidt.

30 June 2022 (Thu), 5pm Singapore/HK time

The Monetary Authority of Singapore (MAS) imposed an additional regulatory capital requirement of S$930mn on DBS, asking them to apply a 1.5x multiplier to its risk-weighted assets (RWAs) for operational risk. Business Times reports that as per DBS’s results ending September 2021, the amount is 4x the amount for a similar disruption that DBS encountered in 2010, when MAS at that time applied a 1.2x multiplier to DBS’ operational risk-weighted assets. Deficiencies in incident management and recovery procedures in restoring its digital banking services was the primary reason for the increase in the amount after the disruption between November 23-25, 2021 where many customers were unable to access online banking services. DBS said the penalty will have a 0.4 percentage-point impact on the group’s capital ratios till remedial actions are completed.

DBS’s dollar bonds were flat with its 3.3% Perp at 100.56, yielding 3.1%.

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