Monetary Authority of Singapore
Encyclopedia
The Monetary Authority of Singapore (Abbreviation
: MAS; ; Malay: Penguasa Kewangan Singapura) is Singapore
's central bank
and financial regulatory
authority. It administers the various statutes pertaining to money, banking, insurance, securities and the financial sector in general, as well as currency issuance
.
As Singapore progressed, the demands of an increasingly complex banking and monetary environment necessitated streamlining the functions to facilitate the development of a more dynamic and coherent policy on monetary matters. Therefore in 1970, the Parliament of Singapore
passed the Monetary Authority of Singapore Act leading to the formation of MAS on 1 January 1971. The act gives MAS the authority to regulate all elements of monetary, banking and financial aspects of Singapore.
The MAS has been given powers to act as a banker to and financial agent of the Government. It has also been entrusted to promote monetary stability, and credit and exchange policies conducive to the growth of the economy.
or Bank of England
, MAS does not regulate the monetary system via interest rates to influence the liquidity in the system. Instead, it chooses to do it via the foreign exchange mechanism. It does so by intervening in the SGD market.
Following its merger with the Board of Commissioners of Currency on 1 October 2002, the MAS assumed the function of currency issuance.
MAS has the exclusive right to issue banknotes and coins in the Republic of Singapore. Their dimensions, designs and denominations are determined by the Monetary Policy Committee with Government approval. The banknotes and coins thus issued have the status of legal tender within the country for all transactions, both public and private, without limitation.
Abbreviation
An abbreviation is a shortened form of a word or phrase. Usually, but not always, it consists of a letter or group of letters taken from the word or phrase...
: MAS; ; Malay: Penguasa Kewangan Singapura) is Singapore
Singapore
Singapore , officially the Republic of Singapore, is a Southeast Asian city-state off the southern tip of the Malay Peninsula, north of the equator. An island country made up of 63 islands, it is separated from Malaysia by the Straits of Johor to its north and from Indonesia's Riau Islands by the...
's central bank
Central bank
A central bank, reserve bank, or monetary authority is a public institution that usually issues the currency, regulates the money supply, and controls the interest rates in a country. Central banks often also oversee the commercial banking system of their respective countries...
and financial regulatory
Financial regulation
Financial regulation is a form of regulation or supervision, which subjects financial institutions to certain requirements, restrictions and guidelines, aiming to maintain the integrity of the financial system...
authority. It administers the various statutes pertaining to money, banking, insurance, securities and the financial sector in general, as well as currency issuance
Singapore dollar
The Singapore dollar or Dollar is the official currency of Singapore. It is normally abbreviated with the dollar sign $, or alternatively S$ to distinguish it from other dollar-denominated currencies...
.
History
The MAS was set up in 1971 to oversee various monetary functions associated with banking as well as finance. Before its establishment, monetary functions were performed by government departments and agencies.As Singapore progressed, the demands of an increasingly complex banking and monetary environment necessitated streamlining the functions to facilitate the development of a more dynamic and coherent policy on monetary matters. Therefore in 1970, the Parliament of Singapore
Parliament of Singapore
The Parliament of the Republic of Singapore and the President jointly make up the legislature of Singapore. Parliament is unicameral and is made up of Members of Parliament who are elected, as well as Non-constituency Members of Parliament and Nominated Members of Parliament who are appointed...
passed the Monetary Authority of Singapore Act leading to the formation of MAS on 1 January 1971. The act gives MAS the authority to regulate all elements of monetary, banking and financial aspects of Singapore.
Responsibilities
In April 1977, the Government decided to bring the regulation of the insurance industry under the wing of the MAS and in September 1984 the regulatory functions under the Securities Industry Act (1973) were also transferred to MAS. This means that unlike many other central banks, MAS is also the financial regulatory authority for Singapore.The MAS has been given powers to act as a banker to and financial agent of the Government. It has also been entrusted to promote monetary stability, and credit and exchange policies conducive to the growth of the economy.
Tools
However, unlike many other central banks such as Federal Reserve SystemFederal Reserve System
The Federal Reserve System is the central banking system of the United States. It was created on December 23, 1913 with the enactment of the Federal Reserve Act, largely in response to a series of financial panics, particularly a severe panic in 1907...
or Bank of England
Bank of England
The Bank of England is the central bank of the United Kingdom and the model on which most modern central banks have been based. Established in 1694, it is the second oldest central bank in the world...
, MAS does not regulate the monetary system via interest rates to influence the liquidity in the system. Instead, it chooses to do it via the foreign exchange mechanism. It does so by intervening in the SGD market.
Issuing Banknotes and Coins
MAS has the exclusive right to issue banknotes and coins in the Republic of Singapore. Their dimensions, designs and denominations are determined by the Monetary Policy Committee with Government approval. The banknotes and coins thus issued have the status of legal tender within the country for all transactions, both public and private, without limitation.