Last month, the Monetary Authority of Singapore ("MAS") published an information paper on "Thematic Review of Collateral Management Standards and Practices of Corporate Lending Business" ("Info Paper").
This client update highlights the key findings and observations of MAS as set out in the Info Paper.
Background
The Info Paper is the output of a thematic review by MAS of the collateral management standards and practices of banks that took place over the course of 2018 and 2019.
This is the third in a series of thematic reviews of corporate lending standards and practices by banks. These reviews first began in 2015, with the first being focused on credit underwriting and the second on credit review.
Findings and Observations from the Thematic Review
The latest thematic exercise was conducted by reviewing banks' frameworks, policies and procedures, interviewing management and staff, performing walkthroughs of banks' processes, and reviewing samples of credit files and management reports. Practices amongst banks included in the thematic exercise were also benchmarked.
The key findings and observations are summarised in the table below, according to sub-headings as follows:
(a) Governance over Collateral Management;
(b) Collateral Portfolio Monitoring;
(c) Valuer Selection; and
(d) Valuation Practices
Click here to download the article.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.