The Association of Banks Singapore (ABS) holds it annual Gala Dinner at Meritus Mandarin hotel in Orchard. From left to right, David Conner, OCBC CEO and outgoing ABS chairman, guest of honour Senior Minister Goh Chok Tong, and Wee Ee Cheong, UOB CEO and incoming ABS chairman. -- ST PHOTO: LIM WUI LIANG
THE outlook for Singapore's financial sector remains bright, according to Senior Minister Goh Chok Tong.
But he says industry players need to adapt to the new realities of the post-financial crisis landscape if the Republic is to remain a leading financial hub.
Speaking to Singapore bankers at the Association of Banks of Singapore (ABS) annual dinner at the Meritus Mandarin Hotel on Friday, Mr Goh acknowledged that 'the tone of discussions about the global financial industry has been rather subdued and introspective'.
But banks here should take heart, he added. 'Singapore is situated at the heart of a growing Asia,' he said. 'It is important not to be complacent as trust, good governance and our reputation for competence require continuous reinforcement as standards change and new demands arise,' he said. 'Nevertheless, our strong fundamentals will give us a firm footing to tap the region's growth opportunities when they come.'
Mr Goh, who is also chairman of the Monetary Authority of Singapore (MAS), laid out five steps to achieving this goal - including measures to make it easier for small investors here to buy government bonds.
First, Singapore must maintain a sound and progressive regulatory regime for the sector - a framework already regarded as stringent pre-crisis.
Second, it has to tap Asia's growing wealth. One key strategy is for the sector to position itself for a shift by wary investors, burnt by the crisis, towards demanding less complex and more transparent investment products, he said.
He said SGS - government bonds - are a useful pricing benchmark for local corporations issuing bonds. Many institutional investors favour SGS as a liquid and safe investment alternative.
Third, Singapore can also capitalise on Asia's infrastructure needs - worth about US$8 trillion (S$11.6 trillion) over the next 10 years as the region builds roads, ports and airports.
The fourth strategy is to enhance Singapore's risk management capabilities and market infrastructure - an area where Singapore can take the lead. He said one move to strengthen market infrastructure is an industry effort to enhance the framework for the fixing of the Singapore Inter-Bank Offer Rate (Sibor) and the Swap Offer Rate (SOR).
Please read the full story in Saturday's edition of The Straits Times.
