MAS proposes simplified leverage requirements for S-Reits, imposes minimum ICR threshold of 1.5 times

THE Monetary Authority of Singapore (MAS) on Wednesday (Jul 24) published a consultation paper proposing to simplify leverage requirements for all real estate investment trusts (Reits).

Under the set of proposals, all Singapore Reits, or S-Reits, will be subject to a minimum interest coverage ratio (ICR) threshold of 1.5 times, and an aggregate leverage limit of 50 per cent.

Commenting on the proposed ICR, the regulator said: “This underscores the responsibility of Reit managers in ensuring that Reits can adequately meet their interest payments.”