In his remarks at the MAS Annual Report 2020/2021 Virtual Media Conference on 30 June 2021, Mr Ravi Menon, Managing Director of MAS said that the Singapore financial system has weathered COVID-19 well thus far.
“Banks entered the crisis from a position of strength and have been a source of stability and support for individuals and businesses throughout the crisis,” he said.
MAS’ concerns at the onset of the crisis that defaults among weaker corporates could strain banks’ profitability and capital positions have not materialised.
However, MAS recognises that problem loans can take time to surface, he added.
Singapore’s financial services sector grew by 5.1% in 2020 even as the overall economy contracted.
In the first half of this year, the sector grew by an estimated 6%.
The FinTech sector has also continued to do well.
Investments in FinTech firms based in Singapore reached a record S$1.4 billion in 2020, an increase of more than 30% from 2019.
In the first quarter of this year, FinTech companies here already raised more than S$650 million, Mr Rav Menon said.
The financial services and FinTech sectors created 2,500 net jobs last year.
MAS expect the financial sector to continue to create good jobs this year.
Financial institutions are expected to create about 6,500 new hiring opportunities this year, with strong demand in areas such as technology, wealth management, corporate banking, and insurance.
The financial services sector has exceeded both the value-added and employment targets set by the Industry Transformation Map (ITM) for 2016-2020.
Growth in value-added during this 5-year period averaged 5.4% per annum, above the ITM target of 4.3%.
The sector, together with FinTech, added an average of 4,700 net jobs per annum, above the target of 4,000.
Overall, the Singapore economy had recouped in the first quarter of 2021 the aggregate output loss incurred during the pandemic.
The recent tightening of domestic restrictions and border controls will have an impact on some segments that make up about 8% of the economy.
But the economic impact of the current restrictions will be significantly less severe than during the circuit-breaker last year.