MAS records net loss of S$10.9b for year ended March 2011

[Roadhogger]

SINGAPORE: The Monetary Authority of Singapore (MAS) has recorded its biggest loss in 40 years on the back of a strong Singapore dollar.

 

MAS has recorded a net loss of S$10.9 billion for its fiscal year ended March 2011. This compared to a record net profit of S$10 billion posted last year.

 

The central bank said excluding exchange rate effects, it achieved income and net capital gains totalling S$12.3 billion during the financial year ended March 2011.

 

MAS disclosed these figures in its latest annual report released Thursday.

 

The loss comes as the foreign exchange impact from the stronger Singapore dollar exceeded the interest, dividend and valuation gains on foreign assets held.

 

Most of MAS's assets comprise official foreign reserves.

 

These are invested in a diversified range of foreign currency assets.

 

During the year, the Singapore dollar appreciated against most currencies including the US dollar, Euro and Sterling Pound, but weakened against the Yen.

 

The total assets of the central bank, including the Currency Fund, grew by S$13.85 billion to S$299.75 billion in the financial year ended 31 March 2011.

 

In 2010, MAS tightened its monetary policy as the economy strengthened. It shifted to a modest and gradual appreciation of the exchange rate policy band in April 2010.

 

Further tightening was undertaken in October 2010 and April 2011 as growth became more entrenched and resource constraints more binding.

 

MAS said the tighter monetary policy stance will ensure price stability over the medium term and keep growth on a sustainable path.

 

In the chairman's message of the annual report, Deputy Prime Minister Tharman Shanmugaratnam said that "the ongoing sovereign debt crisis in the European periphery poses significant risks - both to global economic growth and financial stability."

 

Mr Shanmugaratnam added that Singapore faces a changed financial landscape globally following the crisis of 2008-2009, and that the regulatory approach in Singapore will "evolve, whilst retaining the close monitoring and supervision of financial institutions that ensures that our financial system remains resilient and stable."

 

In the capital markets MAS implemented several safeguards for investors such as guidelines on the form and content of the Product Highlights Sheet.

 

MAS said it will also implement changes to fund management regulation, aimed at raising the quality of players and enhancing regulatory oversight to enable sustained growth of the industry.

 

Going forward Mr Shanmugaratnam said MAS will continue to support the development of Singapore as an international financial centre "trusted for its high standards of regulation, integrity and efficiency."

 

- CNA/cc

 

[LoverofCar]

MORE GOOD YEARS AHEAD!!! Singaporean! is time you refill the chest that lost big time....pay back time!!! Edited July 21, 2011 by LoverofCar

[Mustank]

liao! my friend in mas. i think his bonus liao liao

[Rollagt]

  On 7/21/2011 at 5:15 AM, Mustank said:

liao! my friend in mas. i think his bonus liao liao

 

Work in MAS also consider stat board..so their bonus is quite standard bah.

[Galantspeedz]

If interpreted correctly, it means there was a 12+ billion gain but because they convert the foreign currency to sgd it became a loss as sgd is now stronger against most currencies

 

Am I right?

 

Very confusing leh.... I see keep saying gain gain gain even official foreign asset value but how come loss?

[Joseph22]

  On 7/21/2011 at 5:29 AM, Galantspeedz said:

If interpreted correctly, it means there was a 12+ billion gain but because they convert the foreign currency to sgd it became a loss as sgd is now stronger against most currencies

 

Am I right?

 

Very confusing leh.... I see keep saying gain gain gain even official foreign asset value but how come loss?

 

think we can see it in this manner.

 

money invested in foreign currency will be treated as paper cash as long as its not counted in SGD.

 

so even if asset gain but when convert over might not gain.

 

Example.

1 SGD convert 0.50 USD

but 0.5USD land.

 

then 0.5 USD land gain to USD 1.00

 

but converstion rate become 1SG to 2 USD.

 

so you gain 0.5 USD in profit. but on paper when you cash in. you loss SGD 0.50

[Itsec]

that's why LKY mentioned we need to increase our productivity, sell more..not buy more..we gonna hit hard as QE3 and QE4 coming, and we cant keep printing... this will induce higher inflation...

 

more $$ printed.. richer become richer.. well done... US

[Icedbs]

actually this is no big deal.....

 

Most of their assets are in foreign currency reserves. And this correct because central banks are expected to do that. For example, China has a lot of assets in US treasuries.

 

So if SGD is strong, they will make losses.

 

However, people should look at it in a positive way. They chose to make losses so that Singapore inflation remain moderated and the economy is stable.

 

 

 

 

 

 

[Booboon]

Push coe price higher to recov er lost

[Sdf5725]

dont worry. we are so rich. every few days got record property sales and all normal folk talk like rich rich ppl that can well afford all the expensive stuff.

every where you see millionaires walk on the street, taking MRT, driving big car, etc. how old we also got $$ to cover.

[Galantspeedz]

So all is not what it seems?

[Tarzan666]

okleh..i happy..

 

coz go Msia or other countries, change S$ get more, can shop more..things are cheaper..

[Yewheng]

  On 7/21/2011 at 6:22 AM, Itsec said:

that's why LKY mentioned we need to increase our productivity, sell more..not buy more..we gonna hit hard as QE3 and QE4 coming, and we cant keep printing... this will induce higher inflation...

 

more $$ printed.. richer become richer.. well done... US

 

To increase productivity is to increase in credit card spending? [hur]

Super irritating.. Just 1/2 hr ago.. I receive another call from bank asking me to sign credit card.. ( Imagine many bank keep doing that to many people repetitively ) Haiz..

Edited July 21, 2011 by Yewheng

[Jasonjst]

The loss comes as the foreign exchange impact from the stronger Singapore dollar exceeded the interest, dividend and valuation gains on foreign assets held.

 

What did they do to lost money ? Let Sing Dollars appreciate can lost money one mah ? If they know they are going to let Sing Dollars appreciate , why park so much on foreign assets ? Dont tell me all our reserve in USD ?

[Freestylers09]

but SGD is strong..is it coz of this? currency hedging?

 

so shiok, SGD to RMB 5.3..knn song sia!

[Yewheng]

  On 7/21/2011 at 8:42 AM, Jasonjst said:

The loss comes as the foreign exchange impact from the stronger Singapore dollar exceeded the interest, dividend and valuation gains on foreign assets held.

 

What did they do to lost money ? Let Sing Dollars appreciate can lost money one mah ? If they know they are going to let Sing Dollars appreciate , why park so much on foreign assets ? Dont tell me all our reserve in USD ?

 

Hmm... The only thing that I can think of.. the amount of $ handled should be a lot.. maybe counted few hundred billion (???) .. If not how come with exchange rate can make up so much difference of exchange in currency rate to loss of $10.9 billion?

 

I still don't understand how come converted in exchange rate can be so huge difference..

Edited July 21, 2011 by Yewheng

[Joseph22]

  On 7/21/2011 at 6:41 AM, Galantspeedz said:

So all is not what it seems?

 

yeah not that simple. if you dont convert back, what you have is paper loss. but of couse if you dont convert back to cash, you risk lossing it later.

 

this is a bit like Toyota records sales but still loss money when doing currency exchange. but all they need to do is dont transfer the money back to japan first and wait. at least theirs is in cash. TH is in asset/investment so more dangerous.

Edited July 21, 2011 by Joseph22

[Jasonjst]

  On 7/21/2011 at 8:54 AM, Yewheng said:

Hmm... The only thing that I can think of.. the amount of $ handled should be a lot.. maybe counted few hundred billion (???) .. If not how come with exchange rate can make up so much difference of exchange in currency rate to loss of $10.9 billion?

 

Then why our top economist dont know how to headge those USD reserve with Gold ? or at least headge with Swiss France ?

Edited July 21, 2011 by Jasonjst