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MAS Slaps DBS with S$1.6B Additional Cap Requirement Due to Consecutive Disruptions

The Monetary Authority of Singapore (MAS) has imposed an additional capital requirement on DBS Bank following two consecutive disruptions of its services in just over a month.

Along with the additional capital requirement of S$930 million imposed on DBS in February 2022, the bank will now have to set aside approximately S$1.6 billion in total.

The additional capital requirement on DBS Bank is now a multiplier of 1.8 times to its risk weighted assets for operational risk, an increase from the multiplier of 1.5 times that MAS applied in February 2022.

MAS added that it may subsequently vary the size of the multiplier depending on the outcome of ongoing reviews.

DBS/POSB digibank online and mobile, DBS Vickers mTrading, DBS PayLah! and ATMs services were unavailable from on 5 May from noon until 3.10pm.

DBS did not offer up much of an explanation for the disruption in a statement released on the same day. CEO Piyush Gupta went on to apologise for the disruption and said that the bank was “committed to doing better” and shared that its Special Board Committee, established following the day-long disruption on 29 March, will oversee a full review of the bank’s technology resiliency with an independent external expert.

The bank was directed by MAS to assess the adequacy of management oversight, staff competencies, operational processes, system resiliency, and architecture design for its digital banking services.

Although the causes of the March and May incidents appear distinct from each other, MAS has now required the review to cover the May incident as well.

Ho Hern Shin

Ho Hern Shin, Deputy Managing Director (Financial Supervision) at MAS said,

“DBS Bank has fallen short of MAS’ expectations for banks to deliver reliable services to their customers. The repeated inconvenience caused to the public is unacceptable.

The additional capital requirement imposed at this time underscores the seriousness with which MAS treats this matter. DBS Bank must spare no effort in dealing with the underlying issues leading to these disruptions.”