Banking Act 1970 · 2020 Revised Edition · Part 7 · Powers of Control Over Banks, Etc.
45. Inspection in Singapore by parent supervisory authority
Feedback & supportLast amended by an amending law of 2022. 3 amendments in all.
In relation to a bank incorporated outside Singapore or a foreign‑owned bank incorporated in Singapore, a parent supervisory authority may, with the prior written approval of the Authority and under conditions of secrecy, conduct an inspection in Singapore of the books of any branch or office of that bank in Singapore in accordance with this section if the following conditions are satisfied:
bank incorporated outside Singapore
“bank incorporated outside Singapore” means a bank incorporated, formed or established outside Singapore;
the inspection is required by the parent supervisory authority for the sole purpose of carrying out its supervisory functions;
the parent supervisory authority —
is prohibited by the laws applicable to the parent supervisory authority from disclosing information obtained by it in the course of the inspection to any other person; or
has given to the Authority such written undertaking, as to the confidentiality of the information obtained, as the Authority may determine; and
the parent supervisory authority has given a written undertaking to the Authority to comply with the provisions of this Act and such conditions as the Authority may impose under subsection (2).
Without limiting subsection (1), and subject to subsection (2), the inspection may be conducted in respect of any activity of the bank besides banking business.
bank
“bank” means any company which holds a valid bank licence under section 7 or 79;
The Authority may at any time, whether before, on or after giving written approval for an inspection under this section, require the parent supervisory authority to comply with conditions relating to —
the classes of information to which the parent supervisory authority has or does not have access in the course of the inspection;
the conduct of the inspection;
the use or disclosure of any information obtained in the course of the inspection; and
such other matters as the Authority may determine.
Subject to compliance by a parent supervisory authority with such conditions as the Authority may impose under subsection (2), a bank under inspection —
must afford the parent supervisory authority access to such books of the branch or office of the bank under inspection, and provide such information (including information relating to the bank’s internal control systems) and facilities as may be required to conduct the inspection; and
must not be required to afford the parent supervisory authority access to its books or to provide information or facilities at such times or at such places as would unduly interfere with the proper conduct of the normal daily business of the bank.
A parent supervisory authority may, with the prior written approval of the Authority —
in the case of a bank incorporated outside Singapore, request the auditors of its head office or appoint any person; or
in the case of a foreign‑owned bank incorporated in Singapore, request the auditors of its parent bank or appoint any person,to conduct the inspection under subsection (1) and in such event, this section (other than this subsection) applies to the auditors or the person (as the case may be) as if a reference to the parent supervisory authority or any official of the parent supervisory authority in this section includes a reference to the auditors or the person.
For the purposes of ensuring the confidentiality of any information obtained in the course of an inspection by a parent supervisory authority under this section, section 47(1) applies, with the necessary modifications, to any official of the parent supervisory authority as if the official is an officer of a bank.
officer
“officer”, in relation to a corporation, includes —(a)a director, secretary or an employee of the corporation;(b)a receiver or manager of any part of the undertaking of the corporation appointed under a power contained in any instrument; and(c)the liquidator of the corporation appointed in a voluntary winding up;
Any bank which, without reasonable excuse, refuses or neglects to afford access to any book or provide any information or facility as may be required by this section shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $100,000 and, in the case of a continuing offence, to a further fine not exceeding $10,000 for every day or part of a day during which the offence continues after conviction.
book
“book” includes any record, register, document or other record of information and any account or accounting record, however compiled, recorded or stored, whether in written, printed form or on microfilm or by electronic process or otherwise;
To avoid doubt, this section, and section 46 in relation to an inspection under this section, do not apply to any inspection by a parent supervisory authority of the books of any branch or office of a bank in Singapore, if —
bank in Singapore
“bank in Singapore” means —(a)a bank incorporated in Singapore; or(b)in the case of a bank incorporated outside Singapore, the branches and offices of the bank located within Singapore;
the parent supervisory authority is an AML/CFT authority as defined in section 17 of the Financial Services and Markets Act 2022, and exercises consolidated supervision authority as defined in that section over that bank; and
the inspection is solely for the purpose of such consolidated supervision.
In this section, “parent bank”, in relation to a foreign‑owned bank incorporated in Singapore, means a bank incorporated outside Singapore of which the foreign‑owned bank is a subsidiary.
parent bank
“parent bank”, in relation to a bank or merchant bank, means a financial institution which is able to exercise a significant influence over the direction and management of the bank or merchant bank (as the case may be) or which has a controlling interest in the bank or merchant bank (as the case may be);
Where the offence under subsection (6) is proved to have been committed with the consent of, or to be attributable to any negligence on the part of, an officer of the bank, that officer shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $50,000 or to imprisonment for a term not exceeding 2 years or to both and, in the case of a continuing offence, to a further fine not exceeding $5,000 for every day or part of a day during which the offence continues after conviction.