The Singapore Foreign Exchange Market Committee
c/o Deutsche Bank AG
One Raffles Quay #18-00 South Tower Singapore 048583
15 September 2008
SFEMC statement on Contingent Third Party Information Clearinghouse to facilitate the unwinding of open positions
The Singapore Foreign Exchange Market Committee ('SFEMC") notes the “FXC Announcement regarding contingent third party information clearinghouse to facilitate the unwinding of open positions” dated 14th September 2008 issued by the New York Foreign Exchange Market Committee ("FXC").
SFEMC encourages market participants to extend the facility beyond Spot FX transactions to include FX forwards and derivatives, OTC interest rate derivatives, OTC credit derivatives, NDFs, NDS and NDOs, to the extent possible. SFEMC acknowledges that ICAP has agreed to facilitate this process. We also encourage market participants to engage any third party broker who is willing to act as an intermediary without being a counterparty or guarantor of the proposed trades in the unwinding process.
Unwinding of trades is conducted on a mutually agreed basis between parties. This is not intended to restrict any counterparties from their regular course of business with each other, their clients, or any broker.
NYFXC Announcement
The Singapore Foreign Exchange Market Committee
c/o Deutsche Bank AG
One Raffles Quay #18-00 South Tower Singapore 048583
1 August 08
SFEMC statement on Vietnamese Dong fixings
The Singapore Foreign Exchange Market Committee (SFEMC) seeks to clarify the application of the ABS Rate Fixing on the Vietnamese Dong (VND) currency which took effect on 7 January 2008 (“effective date”).
SFEMC recommends that the new VND fixing rate apply on a prospective basis, to contracts that have trade dates on or after the effective date. It should also be noted that changes to any outstanding bilateral contracts between counterparties can only be agreed mutually on a bilateral basis.
Yours sincerely,
The decision by The Bank of Thailand (BOT) to impose controls on short-term capital inflows has been amended to exclude equity investments. The requirements will still apply to other short-term capital inflows, including debt and property investments. A brief summary of the new measures in effect can be found on BOT's website at http://www.bot.or.th/.
In summary, the BOT has decided to implement an unremunerated reserve requirement on short-term capital inflows, including debt investments. Financial institutions are required to withhold 30% of foreign currencies bought or exchanged against the Thai baht, except for those related to trades in goods and services, or repatriation of investments abroad by residents.
While market reaction to the announcement has been unsettling, the SFEMC wishes to announce that the measures announced by the BOT do not warrant any closure of existing trades as transactions traded prior to 19 December 2006 are exempted from this requirement. The SFEMC, together with other market bodies, will continue to monitor the situation and will inform market participants should there be a need for further action.
October 2003 - An open letter from the Singapore Foreign Exchange Market Committee (SFEMC) to participants in the Singapore financial market.
Dear Market Participant,
The global foreign exchange markets have been concerned for some time about the practice of Undisclosed Principal Trading. This is where a fund manager trading on behalf of a client (who is the principal of the transaction) with a counterparty fails to reveal the identity of the client to the counterparty. The failure to disclose the identity of the principal of the transaction exposes counterparties to a number of credit, regulatory, legal and reputation risks. For instance, with the principal of a trade undisclosed, counterparties would have difficulties verifying its compliance with anti-money laundering rules and regulations.
The SFEMC as a committee devoted to fostering growth of the Singaporefinancial market as a leading international center for transactions in foreign exchange, money markets, fixed income and derivatives instruments naturally share in this concern. SFEMC members who are drawn from Singapore market participants have deliberated this issue extensively and concluded that Undisclosed Principal Trading warrants serious attention.
The SFEMC therefore supports and endorses the initiative of The London Foreign Exchange Joint Standing Committee (FXJSC), which has recently implemented a revision of its NIPs Code, to be effective 31 May 2004 . Under the revised Code, confidential information pertaining to the undisclosed principal (including its full legal name) should be disclosed by a fund manager to the credit, legal and compliance functions of the counterparties, solely for the purpose of risk assessment and management. Such information will not and must not be disclosed to the front offices of the counterparties except in the event of a default.
To the best of our knowledge, the practice of Undisclosed Principal Trading is not prevalent in the Singapore financial markets. Overall, we can be proud of the high standards of professionalism and ethics in our industry. To that end, the Committee will continue to work closely with the Association of Banks in Singapore
SFEMC-ABS Joint Statement on SARSto CEOs/Treasury Head/BCM Head of ABS Member Banks and Other Financial Institutions
29 March 2003
In response to the current developments on the Severe Acute RespiratorySyndrome ("SARS"), the Singapore Foreign Exchange Market Committee("SFEMC") and The Association of Banks in Singapore ("ABS") recommend thefollowing for business continuity management ("BCM") of treasury and dealing rooms' operations.
To minimize or prevent any disruption to normal trading operations of alltreasury activities, financial institutions are encouraged to:
- Avoid travelling to Hong Kong, Hanoi and Guangdong province in China forthe time being, unless absolutely necessary.
- If you have travelled to these places, be vigilant and seek immediatemedical attention if you have fever (more than 38 degree celsius) andrespiratory symptoms including cough, shortness of breath or breathingdifficulty. Do not fly if you have developed such symptoms.- Avoid crowded places if possible.