“I don’t see the flows to suffer,” CEO Piyush Gupta says
SINGAPORE: The exposure of DBS to the recent large-scale money laundering case is around S$100 million, Bloomberg reports Chief Executive Officer Piyush Gupta as saying on Monday (Nov 6). In August, police rounded up 10 Chinese-born nationals holding various foreign passports, nine men and one woman, connected to a money-laundering case involving S$2.8 billion. The large-scale case has caused the country’s financial institutions to tighten policies.
During a briefing where the bank reported an 18 per cent increase in third-quarter net profit on the back of higher interest rates, Mr Gupta said that DBS, Singapore’s biggest bank and South East Asia’s biggest lender, has filed so-called suspicious transaction reports to authorities.
Despite the money laundering scandal, the biggest in Singapore’s history, funds continue to flow into Singapore, he added. Bloomberg quotes him as saying, “I don’t see the flows to suffer.”
In late August, it was reported that DBS Group Holdings and Bank of Singapore, the private banking arm of OCBC Bank, had been creditors to the investment companies linked to accused persons who had been arrested in the round-up by police.
The Straits Times reported that DBS had registered four charges – generally referring to a form of security interest usually taken by a lender to secure repayment of a loan – on Aug 18, 2021, to Aiqinhai Investment. The company’s director and sole shareholder, Su Haijin, is among the 10 arrested.
Read related: DBS & BOS are creditors to alleged money launderers’ Singapore firms
Included in the S$2.8 billion in assets seized or frozen by authorities in the arrests are over 150 properties, cars, and other luxury items such as wines, designer handbags, and watches.
Nevertheless, Mr Gupta sounded optimistic in his Nov 6 statement when he said: “As we enter the coming year, higher-for-longer interest rates will be a net benefit to earnings, while our solid balance sheet with ample liquidity, prudent general allowance reserves and healthy capital ratios will provide us with strong buffers against macro uncertainties.”
Last week, Singapore’s central bank, the Monetary Authority of Singapore (MAS), ordered a six-month pause on the bank from making non-essential IT changes. This move comes after DBS Bank faced multiple digital service disruptions this year.
Read also: MAS imposes six-month pause on DBS bank’s non-essential activities
According to MAS, “DBS Bank will not be allowed to acquire new business ventures during this period or reduce the size of its branch and ATM networks in Singapore. The actions were taken following the repeated and prolonged disruptions of DBS’ banking services this year.” DBS Group later issued a public apology and promised to allocate S$80 million to strengthen its system resilience. /TISG
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