Singapore’s central bank said it has issued a circular guiding financial institutions to establish a client’s source of wealth in a risk-proportionate way, as part of efforts to make account opening in the wealth management industry more efficient while maintaining sound regulatory standards.
The Monetary Authority of Singapore (MAS) said the circular supplements earlier MAS guidance, including a 2024 circular and an information paper on its supervisory expectations for financial institutions’ application of anti-money laundering controls.
The circular provides further guidance for applying the principles of materiality and relevance, so that financial institutions can avoid unnecessary and excessive steps in the process and be more targeted, MAS Managing Director Chia Der Jiun said in opening remarks at the UBS Asian Investment Conference, Singapore Wealth Edition.
The move follows work by the Private Banking Industry Group, or PBIG, which last year established an Account Opening Workgroup, co-led by MAS and industry, to identify ways to make client onboarding more efficient while maintaining sound regulatory standards.
The workgroup identified industry practices that go beyond what MAS’ and international standards required, and considered how to re-align these practices with a risk-proportionate approach.
“More efficient account opening will improve the competitiveness of the wealth management industry while maintaining high standards,” Chia said.
PBIG will also issue a set of Process Enhancement Tips, offering practical ways to address common account opening challenges. In the months ahead, industry will roll out case studies and training for relationship managers and compliance professionals.
These initiatives are expected to lead to significantly more efficient account opening processes, bringing the median time needed to open a private banking account to within a month, down from the current median duration of about six weeks or even longer for more complex cases, Chia said.
Chia said Singapore’s financial centre is built on safety, stability and trust, as well as dynamism and a wide range of capabilities.
He said MAS will continue to reinforce the core foundations of the financial centre by investing in a skilled workforce, adopting a risk-proportionate regulatory approach, promoting innovation and working in partnership with industry.
MAS is also giving increased emphasis to upskilling the financial sector workforce in collaboration with the Institute of Banking and Finance and the industry, with a priority to accelerate the equipping of the financial workforce with skills to work with AI.
Chia said innovation has been core to building new capabilities in Singapore’s financial centre, including the growth of the fintech ecosystem, sandbox testing of new ideas, sustainable finance, tokenisation and digital assets, and the adoption of AI in finance.
He also warned that the global economy continues to face significant uncertainties and risks, including the situation in the Gulf, the sustainability of the AI investment boom, and the risk that global growth becomes narrowly driven by AI.
“Amidst more regular shocks and persistent uncertainty, Singapore’s financial centre and the safety, stability, trust and dynamism that it stands for offers significant value,” Chia said.
Source: MAS opening remarks by Chia Der Jiun at the UBS Asian Investment Conference, Singapore Wealth Edition.