The Monetary Authority of Singapore has raised capital requirements for DBS Bank by S$930 million following the widespread unavailability of the lender's digital banking services in November.
The prolonged two-day outage, caused by a malfunctioning access server, prevented customers from logging into the bank's digital services for two days between 23 and 25 November.
Under Singaporean banking regulations, financial institutions must ensure that the total unscheduled downtime for critical systems affecting services for customers does not exceed four hours within any 12-month period.
After noting deficiencies in DBS Bank’s incident management and recovery procedures, MAS has acted to apply a multiplier of 1.5 times to the bank's risk-weighted assets for operational risk. This is four times higher than the amount for a similar disruption of digital banking services in DBS in 2010, when MAS had applied a multiplier of 1.2 times to the bank's operational risk weighted assets, equivalent to approximately S$230 million in additional regulatory capital.
In adddition, MAS has directed DBS Bank to appoint an independent expert to conduct a comprehensive review of the incident, including the bank’s recovery actions. The additional capital requirement will be reviewed when MAS is satisfied that DBS Bank has addressed the identified shortcomings.
Marcus Lim, assistant managing director, MAS, comments: “MAS requires financial institutions to have robust controls and processes to ensure the reliability and resilience of their IT systems and the continuous delivery of essential financial services to their customers. MAS will take appropriate supervisory action against any financial institution that falls short of our regulatory expectations.”