lee hsien loong : capital markets in the new economy speech by mr lee hsien loong, chairman of the board of directors of the monetary authority of singapore and deputy prime minister, at the 25th anniversary celebration dinner of the singapore investment banking association, held in singapore, on 6 september 2000. * * * chairman, siba, mr koh kah yeok, distinguished guests, ladies and gentlemen, introduction i am happy to celebrate with the singapore investment banking association ( siba ) your 25th anniversary. for many years, siba has actively provided industry feedback on government policies, especially on capital market regulations and developments. these inputs have helped mas to create a conducive environment for all financial players. last november, your association broadened its charter, reconstituted itself to include a wider spectrum of activities and financial institutions, and changed its name to siba. this was a timely move. i am pleased to note that you have formed the siba debt capital market committee. as an mas survey1 shows, corporate debt issuance more than doubled last year to s $ 19. 5 billion. in the first half of this year, corporate debt issuance is already s $ 21. 2 billion, exceeding the volume for the whole of last year. more diverse issuers are tapping the debt market, and interest from local investors has grown. an industry body to champion the development of the debt market, and institutionalise a feedback channel to mas, will therefore play a useful role. global trends in capital markets in the financial industry, globalisation is proceeding apace. there has been a worldwide wave of consolidation among financial institutions, stock and derivative exchanges, and even regulatory bodies. in 1999, there were 900 merger - and - acquisition ( m & a ) transactions among banks, worth us $ 300 billion worldwide. 2 the securities industry has been no less active, with exchanges and clearinghouses in a flurry of mergers and alliances. while globalisation and integration are established features of capital markets, two more recent trends are noteworthy : firstly, stronger linkages between capital market and treasury activities, and secondly, the impact of technology and the internet on capital markets, particularly in the securities industry. mas ’ guidelines on treatment of credit derivatives and securitisation the links between capital market and treasury activities reflect an increase in cross - border transactions. in the us and europe, the spate of mergers and acquisitions has boosted the volume of foreign exchange flows. the mergers have also led to

##used by those who have access to it, to the detriment of bank customers. moreover such misuse would severely damage the trust between banks and their customers, discouraging customers from using the banking system. consequently, the credit reference bureau must be governed by an enabling legal framework which guarantees the confidentiality and accuracy of the information passed to it and ensures that customers give their consent to any information about them being given to the crb. the legal framework in uganda for the credit reference bureau is the mdi act of 2003 and the financial institutions act of 2004. the latter mandates the bank of uganda to establish a credit reference bureau. the bank of uganda has issued regulations and guidelines to govern the operations of the crb. these regulations allow information relating to the performance of a borrower to be submitted to the credit reference bureau. the regulations stipulate that the written consent of the borrower must always be obtained in order to submit credit information to the crb. moreover, the onus of obtaining and keeping a record of the borrower ’ s consent rests with the lender, which must be able to demonstrate that it had obtained this consent in the event of any dispute. the bank of uganda has issued guidelines to the financial institutions that participate in the crb to protect the rights of borrowers and to ensure that data are not misused. financial institutions are required to put in place internal control procedures to ensure that access to the crb is restricted. they must use this information only in connection with their lending operations and with the borrower ’ s consent. guidelines have also been issued to enable the borrower to obtain access to his or her credit report held by the crb, in order to verify whether the data are accurate. the regulatory framework for the crb is not yet complete. within the next year or so we intend to establish a neutral ombudsman who can resolve disputes between customers and the crb on the veracity of the credit information held by the crb. currently there is no law in uganda that ensures the protection of personal data. in future, it would be desirable for uganda to enact a law on credit data protection which would replace the existing crb guidelines. data protection legislation could also allow non financial institutions, such as utility companies, to participate in the crb. in conclusion, i would like to stress that a good regulatory framework that conforms to international best practice, is essential for the efficient operation of the crb and to ensure