Archive
Reuters blog archive
from Breakingviews:
Singapore’s creative bank penalty may be a one-off
By Peter Thal Larsen
(The author is a Reuters Breakingviews columnist. The opinions expressed are his own)
Singapore has come up with a creative way of penalising rate-rigging banks. Regulators are forcing lenders implicated in manipulating the city-state’s borrowing and currency rates to set aside up to S$12 billion ($9.6 billion) in extra central bank reserves. With rates low, however, the costs will be much lower than recent mega-fines.
An investigation by the Monetary Authority of Singapore (MAS) concluded a staggering 133 traders tried to influence rates to their advantage. However, the regulator didn’t find conclusive evidence that they had succeeded. And as attempted manipulation is not explicitly forbidden by existing rules, it could not impose fines on the misbehaving banks.
Nevertheless, the MAS has found a way to extract a pound of flesh. It is demanding that 19 banks deposit extra reserves with the MAS for a year, without receiving interest. That will hit their bottom lines, much like a fine.
from Global Investing:
Asia’s credit explosion
Whatever is happening to all those Asian savers? Apparently they are turning into big time borrowers.
RBS contends in a note today that in a swathe of Asian countries (they exclude China and South Korea) bank deposits are not keeping pace with credit which has expanded in the past three years by up to 40 percent.
from Breakingviews:
Wage subsidy could blunt Singapore’s edge
By Andy Mukherjee
(The author is a Reuters Breakingviews columnist. The opinions expressed are his own)
Singapore’s government hopes that new subsidies for low-wage workers will fix two problems: pressure on company profits, and income inequality. But in doing so, it will just create new problems later on.
from Breakingviews:
Southeast Asia’s growth could lead to credit curbs
By Andy Mukherjee
(The author is a Reuters Breakingviews columnist. The opinions expressed are his own)
Southeast Asia’s heady debt-fuelled growth is beginning to resemble the unsustainable mid-1990s boom. But authorities are shy to raise interest rates as doing so could attract more overseas capital, stoking inflation and financial instability. Direct curbs on credit and capital flows may prove more attractive.
from Breakingviews:
Singapore kicks off necessary benchmark rate cull
By Peter Thal Larsen
(The author is a Reuters Breakingviews columnist. The opinions expressed are his own)
Singapore is kicking off a necessary cull of benchmark interest rates. The city-state is expected to kill off the U.S. dollar Singapore Interbank Offered Rate (Sibor) in order to focus on the weightier local-currency version. With alternatives on tap, the switch should be manageable. It will also be a useful test for London’s planned interest rate bonfire.
from Breakingviews:
Asia’s city-states grapple with slowing growth
By Peter Thal Larsen
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
Singapore and Hong Kong are being forced to come to terms with slowing growth. For decades, the city-states have been among Asia’s economic hotspots. But continued expansion will be restrained by popular discontent about crowding and rising property costs. A more pedestrian future awaits.
from Breakingviews:
Soccer’s betting scam has echoes of Libor scandal
By Peter Thal Larsen
(The author is a Reuters Breakingviews columnist. The opinions expressed are his own.)
Soccer has been whacked with its version of the Libor scandal. The revelation that 680 European and World Cup matches may have been rigged invites comparison with bankers' manipulation of benchmark interest rates before and during the financial crisis. Both require collusion, are hard to detect, and were partly orchestrated in Singapore. Both also undermine confidence. Sadly, soccer's flaws are less easily solved.
from Breakingviews:
Singapore’s demographic engineering on right track
By Andy Mukherjee
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
Singapore’s audacious proposal to squeeze 30 percent more residents on a tiny island between now and 2030 is fraught with political risks for the ruling party. Voters won’t like it. But it’s prudent economics.
from India Insight:
Delhi gang rape victim dies: elsewhere on the web
The 23-year-old woman whose gang rape sparked protests and a national debate about violence against women in India died of her injuries on Saturday, prompting a security lockdown in New Delhi and an acknowledgement from the prime minister that social change is needed.
Bracing for a new wave of protests, authorities deployed thousands of policemen, closed 10 metro stations and banned vehicles from some main roads in the heart of New Delhi, where demonstrators have converged since the attack to demand improved women's rights. Hundreds of people staged peaceful protests at two locations on Saturday morning.
from Breakingviews:
Olam should show, not tell in Muddy Waters fight
By Andy Mukherjee
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
Muddy Waters and Olam are trading punches. The U.S. short-selling firm has released a 133-page report that mixes forensic accounting with some shoe-leather sleuthing in Africa to claim that the Singaporean commodities firm is heading for an Enron-style collapse. Now Olam has hit back with a detailed rebuttal. But for a trading business, perception matters more than facts.
