The central banks of Singapore and Thailand have inked a memorandum of understanding which will allow financial institutions in both countries to access additional liquidity.
Under this arrangement, any eligible financial institutions operating here may obtain Singapore dollars from the Monetary Authority of Singapore (MAS) by pledging Thai baht or Thai government and central bank securities with the MAS.
Similarly, financial institutions operating in Thailand may obtain Thai baht from the Bank of Thailand by pledging Singdollars or Singapore government and central bank securities.
The arrangement allows both central banks to accept a wider range of collateral in their liquidity provisioning facilities. -By Alvin Foo