By Weilun Soon
Singapore's largest bank, DBS, is financially exposed to the tune of around S$100 million (US$73.8 million) to a recent money-laundering scandal in the city-state, its chief executive said Monday.
Piyush Gupta said at a press briefing that the bank had financed property purchases by individuals or companies that are being investigated by Singapore authorities. Police in August arrested 10 foreign nationals on charges including fraud and money laundering.
DBS is one of the several domestic and international banks that have connections with the suspects in the case. Since the mid-August raids, Singapore police have seized or frozen more than US$2 billion worth of assets, including properties, gold bars and jewelry.
Gupta said Monday that DBS had flagged suspicious transactions related to the case to authorities.
"We have almost S$100 million in exposures and basically we have provided for most of it," he said at a briefing.
The bank recorded the equivalent of US$145 million worth of allowances for expected credit losses for the third quarter that ended in September. That total included the provisions it took for the loans it had made to parties involved in the money-laundering probe.
DBS has come under increased scrutiny from Singapore authorities in recent months. The bank was forced by the Monetary Authority of Singapore last week to take a six-month hiatus from acquisitions and from making nonessential technology changes, following a string of digital-banking service outages this year.
Gupta said Monday that the bank will be delayed in introducing some products and services to the market as a result of the freeze, but that the setback gives it a chance to right things.
"It's like putting brakes on. When you put brakes, you can run faster later," he said.
Write to Weilun Soon at email@example.com
(END) Dow Jones Newswires