Recent and ongoing efforts have focused on the areas of licensing and capital adequacy. On licensing, there have been two major initiatives: the new Securities and Futures Act (SFA) and the new Financial Advisers Act (FAA). Public consultation documents and draft legislation of the SFA and  BIS Review 63/2001  1  FAA were released in March 2001. The Bills will be tabled in Parliament soon and are expected to be enacted by the end of this year. The SFA rationalises and consolidates into a single comprehensive legislation the Securities Industry Act, Futures Trading Act, and provisions in the Companies Act related to capital raising. It introduces a single, modular licensing regime for securities and futures intermediaries, which will enhance competition and lower compliance costs. The new legislation will also reflect initiatives that take into account industry developments brought on by globalisation and technological advancements. The FAA provides a single licensing regime and a more flexible and integrated regulatory framework for entities engaging in financial advisory activities for all investment products, and facilitates the setting of consistent professional standards across the industry. Similarly, consistent business conduct standards will govern the sale of unit trusts and life insurance across financial institutions licensed by MAS. With the proposed streamlining in licensing, financial institutions and market participants will no longer need different licences to undertake different classes of financial activities. However, they have to abide by common regulatory standards relevant to the financial activity they engage in, including activities where they are exempted from holding licences.

Against the backdrop of a weaker external economic environment and a more protracted global electronics downturn, near term growth prospects for the Singapore economy have turned significantly weaker while inflationary pressures are subsiding. The slowdown reflects a decline in demand, not an erosion of competitiveness. There is no reason for any persistent weakening of the Singapore dollar. MAS has therefore shifted to a neutral exchange rate policy stance, with a policy band centred on a zero percent appreciation of the $ MAS will continue to guide the $ within this exchange rate band, and stands ready to intervene to dampen excessive volatility should this become necessary. 3  Financial sector supervision and development  MAS' financial sector policies seek to promote a sound and resilient financial system while facilitating innovation, dynamism and competition. Recent and ongoing initiatives by the MAS have focused on: ·  harmonising regulation across the financial sector;  ·  liberalising access to the domestic industry;  ·  promoting corporate governance and market discipline;  ·  implementing a risk-focused supervisory framework; and  ·  developing talent in the financial sector. Harmonising regulation Convergence of financial activities and consolidation of financial institutions have made a more harmonised and integrated approach to regulation more urgent. Consistent regulatory treatment for similar products and activities will help level the playing field; it will also lower compliance costs by streamlining relevant regulations and reporting requirements across activities. As an integrated regulator, MAS has made significant progress in harmonising regulation.