Global Trustee and Fiduciary Services Bite-Sized Issue 8 2024

16 QUICK LINKS AIFMD CBDC CRYPTOASSETS CSDR FINTECH FSB FUND LIQUIDITY MAR MIFID II/MIFIR OPERATIONAL RESILIENCE REMUNERATION SUSTAINABLE FINANCE/ ESG UCITS ASIA PACIFIC EUROPE IRELAND NORTH AMERICA UNITED KINGDOM Global Trustee and Fiduciary Services Bite-Sized | Issue 8 | 2024 ASIA PACIFIC Clarification of MAS’ Policy Intent in Respect of Persons Deemed as ‘Supervisors’ On 26 July 2024, the Monetary Authority of Singapore (MAS) published circular FAS 08/2024 setting out the following: a. Definition of ‘supervisor’ and MAS’ policy intent with regard to the remuneration-related requirements under the BSC framework; b. Factors to consider when determining whether a person is a ‘supervisor’ and non-exhaustive examples of acts of supervision; and c. Clarification on the remuneration-related requirements under the BSC framework. Link to the MASWebsite here MAS Proposes to Impose Minimum Interest Coverage on All REITs On 24 July 2024, MAS published a consultation paper to subject all REITs to a minimum interest coverage ratio (ICR) threshold of 1.5 times and an aggregate leverage limit of 50%, as it simplifies leverage requirements for the sector. MAS proposes that a minimum ICR of 1.5 times apply to all REITs. This underscores the responsibility of REIT managers in ensuring that REITs can adequately meet their interest payments. The proposed threshold is set at 1.5 times as it will now be applied at all times to all REITs. Currently, the ICR requirement of 2.5 times is to be met only by REITs which intend to increase their aggregate leverage from 45% to 50%. MAS says the ICR and aggregate leverage work complementarily to indicate a REIT’s financial strength. To simplify the requirements, MAS proposes that a single aggregate leverage limit of 50% apply to all REITs going forward. MAS says a leverage limit of 50%, together with the ICR floor, will continue to foster prudent borrowing by REITs. To provide investors with information on how a REIT’s credit profile could be affected by changes in market conditions, MAS proposes that REITs perform and disclose sensitivity analyses on the impact of changes in earnings before interest, tax, depreciation and amortisation, and interest rates on REITs’ ICRs. This disclosure is to be made in their interim financial results and annual reports. MAS invites views and suggestions from interested parties on the proposals set out in the consultation paper by 23 August 2024. Link to the MASWebsite here SFC Sets Clear Timeline for Implementing an Uncertificated Securities Market in Hong Kong On 16 July 2024, the Securities and Futures Commission (SFC) released consultation conclusions on its proposed subsidiary legislation, code and guidelines for implementing an uncertificated securities market (USM) in Hong Kong. In response to market feedback, the SFC now proposes a 5-year timeline as follows: • Subject to completing the legislative process, the USM regime will be implemented towards the end of 2025. • Companies whose laws are compatible with the regime will have to transition to the new regime in batches by the end of 2030. A more detailed timeline will be set by the SFC to ensure an orderly transition. In terms of next steps: • The SFC says it will conduct a separate consultation on the maximum levels of certain USM- related fees. • The SFC, together with Hong Kong Exchanges and Clearing Limited and the Federation of Share Registrars Limited, will engage with issuers, investors and other market participants to facilitate their understanding of the new regime, its impact, and the steps needed to participate.