On 31 December 2024, the Financial Services and Markets (Resolution of Financial Institutions) (Amendment) Regulations 2024 (“FSM RFI Regulations“) came into effect to:
- extend the statutory bail-in regime to the insurance sector, by scoping in Singapore-incorporated licensed insurers and designated insurance holding companies (“DFHC (Licensed Insurer)s“) (collectively, “insurers“) as Division 6 financial institutions, as well as expand the scope of eligible instruments to cover instruments issued by insurers.
- prescribe the maximum duration of two business days for stays on reinsurance contracts. This will be a new Regulation under Part 6 of the FSM RFI Regulations.
MAS reminds DFHC (Licensed Insurer)s and licensed insurers that:
- The contract that governs an eligible instrument, as defined under Regulation 28 of the FSM RFI Regulations, must contain provisions to the effect of that specified in Regulations 30(1) and 30(2) of the FSM RFI Regulations.
- They must also comply with the disclosure requirement for an eligible instrument as set out in Regulation 31(1) of the FSM RFI Regulations.
For context, please refer to the earlier MAS “Consultation Paper on Proposed Amendments to Financial Services and Markets (Resolution of Financial Institutions) Regulations 2024” issued on 12 September 2024. MAS’ Response to Feedback Received on the Consultation Paper is available here. MAS also issued Circular ID 19/24 to DFHC (Licensed Insurer)s and licensed insurers. You may also wish to refer to the related write-up in our September 2024 Newsbytes write-up titled “MAS Consults on Proposed Extension of Statutory Bail-In Regime to Insurers and DFHCs, New Maximum Duration of Temporary Stays on Reinsurers’ Early Termination Rights”, available here.
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