Regulations for Fund Management Companies

What can MAS direct a financial institution (FI) to do in the event of breach of financial requirements?


  • According to MAS (Regulations),
    last revised on 08 October 2018

    (2)  If the Authority is notified by the holder under paragraph (1) or becomes aware that the financial resources or adjusted net head office funds (as the case may be) of the holder have fallen below 120% of its total risk requirement, the Authority may —

    (a)    direct the holder to immediately do one or more of the following:

    (i)    cease any increase in positions, product financing, funds accepted for management and assets accepted for custody for any account carried by the holder;
    (ii)    transfer all or part of any customer’s positions, margins, collateral, assets and accounts to one or more other holders of licences;
    (iii)    operate its business in such manner and on such conditions as the Authority may impose;
    (iv)    cease carrying on business in any or all of the regulated activities permitted under its licence until such time that the holder has demonstrated that its financial resources or adjusted net head office funds (as the case may be) are not less than 120% of the total risk requirement of the holder, except that the holder may continue trading for the purposes of liquidation only or if otherwise directed by the Authority; or

    (b)    revoke the licence of the holder under section 95(2) of the Act.