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The Singapore Foreign Exchange Market Committee
c/o Deutsche Bank AG
One Raffles Quay #18-00 South Tower Singapore 048583



15 September 2008

SFEMC statement on Contingent Third Party Information Clearinghouse to facilitate the unwinding of open positions


The Singapore Foreign Exchange Market Committee ('SFEMC") notes the “FXC Announcement regarding contingent third party information clearinghouse to facilitate the unwinding of open positions” dated 14th September 2008 issued by the New York Foreign Exchange Market Committee ("FXC").


SFEMC encourages market participants to extend the facility beyond Spot FX transactions to include FX forwards and derivatives, OTC interest rate derivatives, OTC credit derivatives, NDFs, NDS and NDOs, to the extent possible. SFEMC acknowledges that ICAP has agreed to facilitate this process. We also encourage market participants to engage any third party broker who is willing to act as an intermediary without being a counterparty or guarantor of the proposed trades in the unwinding process.


Unwinding of trades is conducted on a mutually agreed basis between parties. This is not intended to restrict any counterparties from their regular course of business with each other, their clients, or any broker.

NYFXC Announcement

The Singapore Foreign Exchange Market Committee
c/o Deutsche Bank AG
One Raffles Quay #18-00 South Tower Singapore 048583


1 August 08

SFEMC statement on Vietnamese Dong fixings

The Singapore Foreign Exchange Market Committee (SFEMC) seeks to clarify the application of the ABS Rate Fixing on the Vietnamese Dong (VND) currency which took effect on 7 January 2008 (“effective date”).


SFEMC recommends that the new VND fixing rate apply on a prospective basis, to contracts that have trade dates on or after the effective date.  It should also be noted that changes to any outstanding bilateral contracts between counterparties can only be agreed mutually on a bilateral basis.


Yours sincerely,

The decision by The Bank of Thailand (BOT) to impose controls on short-term capital inflows has been amended to exclude equity investments. The requirements will still apply to other short-term capital inflows, including debt and property investments. A brief summary of the new measures in effect can be found on BOT's website at http://www.bot.or.th/.

In summary, the BOT has decided to implement an unremunerated reserve requirement on short-term capital inflows, including debt investments. Financial institutions are required to withhold 30% of foreign currencies bought or exchanged against the Thai baht, except for those related to trades in goods and services, or repatriation of investments abroad by residents.

While market reaction to the announcement has been unsettling, the SFEMC wishes to announce that the measures announced by the BOT do not warrant any closure of existing trades as transactions traded prior to 19 December 2006 are exempted from this requirement. The SFEMC, together with other market bodies, will continue to monitor the situation and will inform market participants should there be a need for further action.

20 September 2006 

All Treasury Managers, 

RECOMMENDATION BY SFEMC ON THE SETTLEMENT OF THAI BAHT (THB) TRANSACTIONS 

Following the announcement of an unscheduled Bank Holiday in Thailand today, the Singapore Foreign Exchange Market Committee recommends that THB transactions for value today (20 Sep 06) be rolled over to value 21 Sep 06. It is also recommended that payments of all currencies related to these transactions be similarly made on value 21 Sep 06. 

SINGAPORE FOREIGN EXCHANGE MARKET COMMITTEE

October 2003 - An open letter from the Singapore Foreign Exchange Market Committee (SFEMC) to participants in the Singapore financial market. 

Dear Market Participant, 

The global foreign exchange markets have been concerned for some time about the practice of Undisclosed Principal Trading. This is where a fund manager trading on behalf of a client (who is the principal of the transaction) with a counterparty fails to reveal the identity of the client to the counterparty. The failure to disclose the identity of the principal of the transaction exposes counterparties to a number of credit, regulatory, legal and reputation risks. For instance, with the principal of a trade undisclosed, counterparties would have difficulties verifying its compliance with anti-money laundering rules and regulations.

The SFEMC as a committee devoted to fostering growth of the Singaporefinancial market as a leading international center for transactions in foreign exchange, money markets, fixed income and derivatives instruments naturally share in this concern. SFEMC members who are drawn from Singapore market participants have deliberated this issue extensively and concluded that Undisclosed Principal Trading warrants serious attention. 

The SFEMC therefore supports and endorses the initiative of The London Foreign Exchange Joint Standing Committee (FXJSC), which has recently implemented a revision of its NIPs Code, to be effective 31 May 2004 . Under the revised Code, confidential information pertaining to the undisclosed principal (including its full legal name) should be disclosed by a fund manager to the credit, legal and compliance functions of the counterparties, solely for the purpose of risk assessment and management. Such information will not and must not be disclosed to the front offices of the counterparties except in the event of a default. 

To the best of our knowledge, the practice of Undisclosed Principal Trading is not prevalent in the Singapore financial markets. Overall, we can be proud of the high standards of professionalism and ethics in our industry. To that end, the Committee will continue to work closely with the Association of Banks in Singapore

SFEMC-ABS Joint Statement on SARSto CEOs/Treasury Head/BCM Head of ABS Member Banks and Other Financial Institutions

29 March 2003
In response to the current developments on the Severe Acute RespiratorySyndrome ("SARS"), the Singapore Foreign Exchange Market Committee("SFEMC") and The Association of Banks in Singapore ("ABS") recommend thefollowing for business continuity management ("BCM") of treasury and dealing rooms' operations.

To minimize or prevent any disruption to normal trading operations of alltreasury activities, financial institutions are encouraged to:

  1. Keep current their BCM plans;
  2. Heed the travel advisory issued by the Ministry of Health to:


- Avoid travelling to Hong Kong, Hanoi and Guangdong province in China forthe time being, unless absolutely necessary.

- If you have travelled to these places, be vigilant and seek immediatemedical attention if you have fever (more than 38 degree celsius) andrespiratory symptoms including cough, shortness of breath or breathingdifficulty. Do not fly if you have developed such symptoms.- Avoid crowded places if possible.

  1. As a result of Bank Indonesia's regulation on Rupiah transactions, the Singapore Foreign Exchange Market Committee has issued guidelines for best practice for closing-out outstanding Indonesian Rupiah (IDR) transactions on a consensual basis. A  circular from the Association of Banks in Singapore and a  letter from the SFEMC chairman provide relevant information on this matter.


  2. 26 February 2001 
    MEETING WITH THE BANK INDONESIA DEPUTY GOVERNOR ON 26 FEBRUARY 2001 

    Bank Indonesia Deputy Governor, Miranda Goeltom and her team were in Singapore and met with the senior members of the SFEMC as well as the other ABS' member banks in the IDR market this afternoon. During this meeting, Ms Goeltom gave a briefing and presentation on : 

    (a) The background on the regulation of Rupiah transactions 
    (b) The main objective of the regulation 
    (c) The coverage of the regulation 
    (d) The latest development of the domestic forex market
3 September 1998 

All Treasury Managers,

NOTES OF MEETING ON SETTLEMENT OF MALAYSIAN RINGGIT (MYR) DEALS

Following the announcement of exchange controls in Malaysia on 1st Sep 98, the Singapore Foreign Exchange Market Committee held a meeting with market participants on this matter. As a follow-up, a meeting was held on 2nd Sep 98 to discuss settlement of outstanding MYR transactions. The list of banks represented is in Appendix 2. 

The meeting noted that the market for MYR had been severely disrupted by the recently announced measures, giving rise to potential risk exposures. Market participants generally agreed that the following guidelines could be adopted as recommended practice for closing outstanding MYR transactions: 

  • Banks should close-out MYR-related transactions with counterparties by netting all outstanding trades and settling the difference in US$.

  • It was noted that the freely traded market for MYR ceased as of approximately 10.30am, 1st Sep 98. As such it is proposed that the representative rate prevailing at that time be used as the guideline for bilateral settlement. For this purpose, a spot US$/MYR rate of 4.00, a benchmark yield curve, an option volatility structure and other technical matters listed in Appendix 1 is a fair and equitable basis for valuing future payments with a view towards determining discounted future cash flows.

  • Close-out settlement should be effected as soon as possible and no later than 9th Sep 98.

All affected parties should exert their best efforts to reach an appropriate close-out arrangement. A practical date for making the net payment would be 

8th Sep 98. 
VICTOR LIEW CHAIRMAN