EXPOSURE OF SINGAPORE BANKS

Mr Shriniwas Rai asked the Deputy Prime Minister, in view of the current situation in Indonesia, whether the exposure of the Singapore banks has increased, and, if so, whether he could provide the House the extent of this exposure.

BG Lee Hsien Loong: As at 30th April 1998, the 6 local banking groups had loans and investments amounting to $3.9 billion (1.6% of their total assets) in Indonesia. This is $1.5 billion or 28% lower than it was in December 1997.

The local banks, in consultation with MAS, had in 1997 set aside substantial provisions to cater to the potential risks arising from their exposure to the regional economies, including Indonesia. In view of the current situation in Indonesia, the local banks have indicated that they would set aside additional provision in 1998 for their exposure to Indonesia.