The bank told him then that there was 'no problem with the notes', he said, but the Monetary Authority of Singapore (MAS) has since clarified that such notes have been mutilated on purpose and are therefore worthless.

The letters looked 'legally imprinted', said Mr Lee in an e-mail to The Straits Times online portal, Stomp, asking what the letters might mean. But 'KF' is not part of the $50 note's design, said MAS' spokesman, adding it did not know what 'KF' stood for.

'Notes with such markings are considered to be deliberate mutilation and they command no value,' she added.

Anyone who has notes with the markings can take them to the banks to be exchanged, she said, and MAS will take the notes back as an 'act of grace'.

When contacted, OCBC's head of group corporate communications Koh Ching Ching said currency could have become defaced while being circulated.

She said the bank's ATMs will be checked so any other mutilated notes can be retrieved.

She added that OCBC's tellers are 'trained to look out for defaced or mutilated notes and handle them as per guidelines provided by MAS', and that it has reminded its staff to be vigilant.

Read the full story in Thursday's edition of The Straits Times.