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Parallel Presentation

Parallel Presentation. The New People’s Bank: Ending On A High Note. Parallel Presentation. “Globalization will make our societies more creative and prosperous, but also more vulnerable” - Lord Robertson. Financial Globalization.

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Parallel Presentation

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  1. Parallel Presentation The New People’s Bank: Ending On A High Note.

  2. Parallel Presentation “Globalization will make our societies more creative and prosperous, but also more vulnerable” - Lord Robertson

  3. Financial Globalization • Intensive cross border financial and payment flow • Broad array of financial instruments • Greater international risk-sharing. • International profile of financial participants enhance our development as a financial hub • Integrated markets

  4. Provides a greater range of job opportunities Cheaper source of financing Deeper, more liquid markets Platform for countries to work together Gains from Financial Globalisation

  5. Investors take responsibility for their decisions Intensify Competition Banking Consolidation Singapore’s Financial Liberalization Roadmap Greater leeway in financial innovation Qualifying Full Bank (QFB) scheme Encourage strong local banks Disclosure based regime 1998 1999 2001 2002 Financial Liberalisation

  6. Singapore’s Achievements Premier Asset Management Centre with assets worth approximately S$ 1 trillion Second largest over-the-counter derivatives trading centre in Asia Singapore Financial Hub Top 5 most active foreign exchange trading centres in the world Growing wealth management hub of the East

  7. Shift from bank-centered to market-based financing resulting in decline in banks’ core business areas Issue of QFB licences to foreign banks leading to intense competition at the retail level Impact of Financial Globalisation on Local Banks

  8. Why Sell Complex Financial Products? • Government • Need to embrace financial innovation • Balance between regulation and empowering investors • Investors • Enhanced investor choice • Better returns albeit with higher risk • Maybe suitable for a select group of educated investors • Financial Institutions • Intense competition resulting in need to follow other banks • Cater to client needs • Additional revenue stream

  9. 1st Video Presentation Angry Investors Flood Speaker's Corner seeking redress

  10. Existing Financial Education • Multi-agency Financial Education Steering Committee • MoneySENSE • National financial education programme launched in 2003 • Comprise of basic money management, financial planning and investment know-how • Short courses/seminars are also available • Singapore Exchange, SGX • Security Investors Association (Singapore), SIAS • NTUC, etc

  11. Investor Education • Many consumers/sellers do not understand financial products that they deal with. • This has led to cases where retirees lost all of their savings, and also, young educated financial professionals who are unsure of the financial products they are sell. DBS 'High Notes 5' Investors:They pumped in life savings and now feel cheated. Tue, Dec 23, 2008AsiaOne Lone protestor's plea: 'Return my medical fee'

  12. Skit 1 SKIT 1

  13. 2nd Video Presentation On CD rom MAS Proposed New Guidelines On Investment Products Sales

  14. Skit 2 SKIT 2

  15. Revised MAS guidelines More MAS leeway to go after errant financial institutions Short, user-friendly Product Highlights Sheet to promote more effective disclosure Health warning to accompany complex financial products Better retail investor protection Stop bank tellers from referring customers to financial advisors to sell investment products

  16. Rebuilding Relationships with Local Clientele What more can banks do? Investment Product Introduce easy-to-understand financial products Transparent marketing techniques Sales Process Ethical, knowledgeable and trustworthy sales staff Better alignment of incentives structure

  17. Rebuilding Relationships with Local Clientele What more can banks do? Investor Education Conduct regular financial seminars Distribute clear financial brochures Corporate Strategy Embark on re-branding strategy to restore client confidence Refocus corporate culture on fair trading with customers

  18. A Fine Balancing Act Financial Regulation Financial Development Singapore Status as a Financial Hub

  19. It is the job of the MAS to regulate the finance industry. However, over-regulation would lead to a disintegration of the sovereignty of the sector. What is needed is "smarter regulation" that will neither constrain choice nor innovation but make transparent the consequences of different choices in the financial system Conclusion

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