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MAS, ABS set up steering group for better conduct among banks in S'pore

A STEERING group has been set up to foster more rigorous culture and conduct practices among banks in Singapore, said the Monetary Authority of Singapore (MAS) and the Association of Banks in Singapore (ABS) on Wednesday. 

The Singapore regulator has been intensifying its supervision of financial institutions in the past two years, including conducting culture and conduct surveys at several banks, as well as thematic inspections of incentive structures. 

While the implementation of best practices is robust in some institutions, others have been found wanting, Ho Hern Shin, MAS's assistant managing director for banking and insurance, had said at an industry roundtable in March, where the idea for the steering group was first mooted. 

For example, she had noted that some banks are still employing compensation structures based primarily on financial targets.

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Financial institutions need to adopt ethical ways to achieve key performance indicators, taking into account the interests of clients and the risks involved, she had said.

The culture and conduct steering group's (CCSG) purposes include identifying best practices in the area of culture and conduct and sharing them with the wider industry to facilitate adoption. 

The group will also monitor trends and identify emerging conduct and culture issues within the industry, and collaborate with MAS on initiatives.

Chaired by DBS Bank's Singapore country head Shee Tse Koon, the culture and conduct steering group comprises members from 12 other banks in Singapore, who have responsibilities in business, risk management, compliance and human resource. Among them are Chan Kok Seong, head of group credit and risk management at UOB, and Loretta Yuen, head of group legal and regulatory compliance at OCBC. 

Mr Shee said: "Banks understand the need to focus on culture as it drives the behaviour of their employees and leads to positive outcomesfor customers. This is a nascent area where there is potential to do more. The CCSG is eager to work with the industry and MAS to foster a sound culture within their organisations and uplift industry standards."