On 25 March 2026, the Monetary Authority of Singapore (“MAS“) issued a Consultation Paper proposing enhanced recovery and resolution planning requirements for systemically important Capital Market Infrastructures (“CMFMIs“) – comprising Approved Clearing Houses, Licensed Trade Repositories, and the Depository. Key proposals include: (i) a new Notice and Guidelines under the Financial Services and Markets Act 2022 (“FSMA“) expanding recovery and resolution plan (“RRP“) requirements; and (ii) statutory bail-in powers for the CMFMI sector. The proposals align with the Financial Stability Board’s Key Attributes of Effective Resolution Regimes for Financial Institutions (“FSB KAs“) and sector-specific guidance. Comments must be provided to MAS by 24 April 2026.
CMFMIs are currently required to maintain RRPs under the Securities and Futures Act 2001 (“SFA“). The new Notice and Guidelines expand on these requirements, covering: (i) recovery planning; (ii) orderly wind-down planning; (iii) resolution planning; and (iv) notification requirements and operational continuity.
MAS will issue directions under the FSMA to all CMFMIs and certain Approved Holding Companies (“AHCs“) at group level (collectively, “notified CMFMIs“) to comply with the new Notice and Guidelines. A six-month transition period is proposed from the date of publication. Existing requirements to maintain an RRP under various SFA legislation will be removed.
Key Proposals
- Recovery Planning
- A recovery plan (“RCP“) must include: (i) identification of critical functions and stress scenarios; (ii) assessment of recovery options; (iii) implementation measures; and (iv) a stakeholder communication plan.
- Recovery tools must be comprehensive, reliable, timely, transparent, and designed to minimise systemic impact.
- The RCP must be reviewed and tested annually and be endorsed by the notified CMFMIs’ board of directors (“board“).
- A recovery plan (“RCP“) must include: (i) identification of critical functions and stress scenarios; (ii) assessment of recovery options; (iii) implementation measures; and (iv) a stakeholder communication plan.
- Orderly Wind-down Planning
- Notified CMFMIs must prepare an orderly wind-down plan (“OWP“) where recovery measures fail, containing the plans, procedures, and systems necessary to wind down notified CMFMIs in an orderly manner.
- The OWP must be reviewed annually and be endorsed by the board; however, periodic testing is not required.
- Notified CMFMIs must prepare an orderly wind-down plan (“OWP“) where recovery measures fail, containing the plans, procedures, and systems necessary to wind down notified CMFMIs in an orderly manner.
- Resolution Planning
- Notified CMFMIs must:
(i) maintain and submit information on organisational structure; critical functions; dependencies; risk management; and applicable foreign legal frameworks; and
(ii) inform MAS of any material changes to their business or structure.
- Notifications and Operational Continuity
- Notified CMFMIs must immediately notify MAS if their viability is, or is potentially, threatened, or upon the occurrence of any event that may require implementation of their RCP or OWP.
- There must be contingency arrangements for IT systems, trading/clearing/settlement facilities, supplier/employee contracts, and access to operational assets.
- Notified CMFMIs must immediately notify MAS if their viability is, or is potentially, threatened, or upon the occurrence of any event that may require implementation of their RCP or OWP.
- Resolution Powers for Statutory Bail-in Regime
- Scope: The statutory bail-in regime is extended to CMFMIs incorporated in Singapore, and relevant AHCs, consistent with FSB KAs.
- Eligible Instruments: The statutory bail-in regime will apply to equity instruments (except ordinary shares) and unsecured subordinated liabilities or debt instruments issued or contracted after the effective date of the relevant legislative amendments. There will be no retrospective application. MAS will respect the statutory creditor hierarchy and equal treatment of creditors of the same class; the compensation framework applies where departure is necessary to contain systemic impact or maximise value for creditors.
- Contractual Bail-In Provisions: FSMA Regulations 30 and 31 (restrictions on eligible instruments and disclosure requirements) will be extended to the CMFMI sector. Contractual bail-in provisions are required for instruments governed by foreign law.
- Conversion Powers: New statutory powers will be introduced for MAS to convert into equity and write down contingent convertibles and contractual bail-in instruments not triggered prior to resolution.
- Scope: The statutory bail-in regime is extended to CMFMIs incorporated in Singapore, and relevant AHCs, consistent with FSB KAs.
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