The country’s central bank (MAS) has imposed bans on the Singapore branch of ABN AMRO Bank, DBS Bank and eight other institutions for the sale of structured notes, ranging from six months to a minimum of two years.
The move follows a report made by the bank into the financial institutions that distributed the notes.
It found inconsistent risk warnings stated in some of their prospectus and pricing statements and insufficient training of financial advisory representatives for the marketing and sale of notes.
The report also identified weaknesses in the way some of the financial institutions equipped financial advisory representatives with accurate and complete information about the notes.
The central bank has issued formal directions for the institutions to rectify all weaknesses identified and to review and strengthen all internal processes and procedures for the provision of financial advisory services across all investment products.
The financial institutions will be required to appoint an external person approved by MAS to review their action plan and report on implementation.
MAS deputy managing director for market conduct Shane Tregillis says: “MAS’ investigations have been thorough and objective. Based on our investigation findings for each financial institution, MAS has taken appropriate regulatory action. The industry as a whole needs to carefully reflect on these findings, take immediate steps to win back the trust and confidence of their customers and prevent similar problems from emerging in the future.”