Singapore’s lenders are not heavily exposed to the European banking system and will not suffer much collateral damage if the continent’s debt crisis worsens.
The assurance came from the Monetary Authority of Singapore (MAS) yesterday in response to queries from The Straits Times about the risks facing local banks.
It noted that euro zone banks in Singapore account for less than 10 per cent of the total loans to residents in Singapore who are non-bank borrowers. ‘The MAS has been closely monitoring developments in the global financial markets. Our local banks’ exposures to European banks are not material.’
The debt crisis has the potential to spiral out of control in Europe. Many of its banks hold significant amounts of euro zone sovereign debt on their books. -By Yasmine Yahya