The six-month pause on non-essential activities imposed on DBS Bank by the Monetary Authority of Singapore (MAS) ends today, April 30. MAS has announced that it will not be extending this pause, which was effective from Nov 1, 2023; but the multiplier of 1.8 times to DBS Bank’s risk-weighted assets for operational risk will be retained.
MAS imposed the six-month pause last year after a series of disruptions to DBS’s digital banking services. The move barred DBS from acquiring new business ventures.
In an April 30 statement, MAS notes that DBS Bank has made “substantive progress” to address the shortcomings identified from service disruptions experienced by its customers in 2023.
“Improvements have been made to its technology risk governance, system resilience, change management and incident management,” says MAS.
DBS CEO Piyush Gupta had his FY2023 pay cut by around 27% y-o-y to $11.23 million, comprising basic salary plus other bonuses and incentives. A decision by DBS’s board, Gupta's pay cut was to signal responsibility for a series of digital disruptions experienced by the bank's customers.
According to MAS, DBS is working on “some longer-term measures”, including simplifying and strengthening the bank’s “systems architecture”. “DBS Bank has committed to prioritise resources and dedicate management attention to complete the outstanding remediation measures.”
MAS says it will “closely monitor” DBS’s progress. “In the event of service disruptions, MAS expects DBS Bank to promptly recover its services and communicate to its customers in a clear and timely manner.”
MAS says it will only lift the multiplier of 1.8 times when it is satisfied that DBS has “demonstrated the ability to maintain service availability and reliability, and handle any disruptions effectively”.
Gupta says the pause has allowed DBS to reflect on areas for improvement. “In the months ahead, we will continue to prioritise resources to strengthen technology resiliency. We will also dedicate management attention to ensuring that our efforts have sustained effectiveness. Our pledge is to ensure that innovation is well-balanced with resiliency so as to meet our customers’ expectations for reliable, seamless and effortless banking.”
Shares in DBS closed 12 cents higher, or 0.35% up, at $34.90.
