Outsourcing Financial Institutions in Singapore

Outsourcing a bank in Singapore

Before deciding to outsource the institution (a bank) should notify to monetary authority of Singapore, in most cases MAS is interested in material outsourcing. Outsourcing material is impact on an institution by demolishing operations of business, reputation and profitability. Where outsourcing is material, Monetary Authority of Singapore expects that the institution applies all practices of management of risks which are divided into four important steps:

• Choose allowed suppliers and business structuring of outsourcing

• Direction and outsourcing surveillance agreement

• Guarantee efficient and independent orders of validation

• Made urgent preparation

Additional measures to be taken by the MAS and the establishment of financial system in accordance with the terms of the possible impact of other external resource situation such as surveillance measures may be necessary. MAS also directly from the institutions and the main controller in his home or other service provider, for their skill and supervision agency was willing to work together with MAS on outsourcing risks.

MAS should also be informed of any adverse development arising in outsourcing that could significantly affect the bank, including any events which lead to the completion and early exit of the arrangement. Any breach of legal and regulatory requirements by the service provider should also be alarmed to MAS. MAS may require an institution to reform, make alternative arrangements or re-unify an outsourcing into the bank where:

• An institution fails or incapable to implement any action to reach satisfactory results in guiding risks and defects on time.

• Negative developments can significantly affect an institution emerged ...

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...k. If the situation thoroughly analyzed, the bank may not face with this deprivation. The first issue is that the bank itself the biggest bank with a lot of branches around the world, the data of bank can be printed inside of the institution without transferring work to Fuji Xerox company. The second problem is security, as discussed below, bank should periodically develop IT systems and professionals should secure the data from hackers. However, from the sources, in every bank can appear this kind of problems, even in Switzerland bank in last 2 years there were five evidences with cyber crime. Then, confidentiality of customers is the third challenge which encountered by StanChart. The bank should inform the clients about outsourcing beforehand and the client’s information may also be transferred to third-party, hence, the consumers won’t be dissatisfied.