Regulatory Alerts2025-03-27
Added
Consultation Paper on Proposed Equity Counter-Cyclical Adjustment and Inclusion of Additional Criteria for AT1 and Tier 2 Capital Instruments for Insurers
The Monetary Authority of Singapore (MAS) proposes finetuning the enhanced risk-based capital framework for insurers by introducing a counter-cyclical adjustment for equity investment risk requirements. The regulator also seeks to include additional criteria for the recognition of Additional Tier 1 and Tier 2 capital instruments to align with global regulatory changes. Industry stakeholders are invited to submit comments on these proposed changes by 28 April 2025.
Circular No: ID 02/25 27 March 2025 To the Chief Executives All Licensed Insurers except for Captive Insurers, Marine Mutual Insurers and SPRVs All Designated Financial Holding Companies (Licensed Insurer) Dear Sir/Madam CONSULTATION PAPER ON PROPOSED EQUITY COUNTER-CYCLICAL ADJUSTMENT AND INCLUSION OF ADDITIONAL CRITERIA FOR ADDITIONAL TIER 1 AND TIER 2 CAPITAL INSTRUMENTS FOR INSURERS The Monetary Authority of Singapore (MAS) has issued the consultation paper on Proposed Equity Counter-cyclical Adjustment and Inclusion of Additional Criteria for Additional Tier 1 and Tier 2 Capital Instruments for Insurers today. 2 MAS is looking to finetune the enhanced risk-based capital framework (“RBC 2 framework”) for insurers in Singapore, which has been implemented with effect from 31 March 2020. Such further enhancements will take into account, amongst others, global regulatory changes and market developments. MAS will continue to consult and engage the industry and public on the ongoing finetuning of the RBC 2 framework. For the purpose of this consultation paper, MAS is proposing the following: (a) Introducing a counter-cyclical adjustment for the equity investment risk requirement; and (b) Inclusion of additional criteria for Additional Tier 1 and Tier 2 capital instruments. 3 Please refer to Annex 1 for a copy of the consultation paper, which is also publicly available on the MAS website: https://www.mas.gov.sg/publications/consultations/2025/consultation-paper-on-proposedequity-cca-and-capital-instruments
4 Please submit your comments on the consultation paper by 28 April 2025 via the link provided [Response to CP-P001-2025]. Thank you. Yours faithfully [sent via MASNET] DANIEL WANG EXECUTIVE DIRECTOR INSURANCE DEPARTMENT
ANNEX 1 – CONSULTATION ON PROPOSED EQUITY COUNTER-CYCLICAL ADJUSTMENT AND INCLUSION OF ADDITIONAL CRITERIA FOR ADDITIONAL TIER 1 AND TIER 2 CAPITAL INSTRUMENTS FOR INSURERS Consultation Paper on Proposed Equity Counter-Cyclical Adjustment and Inclusion of Additional Criteria for AT1 and Tier 2 Capital Instruments for Insurers