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Amid oil rout, MAS seeks prudent provisioning by banks

It does not prescribe provisioning but through its questions, banks know they need to be conservative

Published Mon, Jul 25, 2016 · 09:50 PM

Singapore

AGAINST the backdrop of volatile oil prices and banks' exposure to oil-related companies, the Monetary Authority of Singapore (MAS) is querying banks on their provisioning decisions, and has made clear that banks should have prudent standards.

Provisions are a form of reserves taken against earnings and are typically measured as a percentage of all loans. It is a cushion against souring loans.