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The new liquidity coverage ratio (LCR) requirements set forth by the Monetary Authority of Singapore are not expected to pose major challenges for the local Singapore banks, due to their sound funding and liquidity positions.
The new rules, announced on 24 June, are in line with wider Basel III objectives, and will require locally incorporated banks to maintain a full (100%) local-currency LCR from January 2015.
Fitch Ratings says that the strong domestic deposit franchises - Singapore dollar loan/deposit ratios are between 75%-85%...