18.—(1) Subject to paragraphs (3) and (4), the extent to which the Singapore Insurance Fund Assets shall be taken into account under regulation 17 shall be subject to the investment limits specified in the Schedule.
(2) To determine whether the investment limits specified in the Schedule have been complied with, the assets shall be valued as prescribed in Part III.
(3) The investment limits imposed on overseas assets specified in the Schedule shall not apply to Singapore Dollar denominated fixed income or floating rate securities issued by non-residents that are accorded —
(a)
a rating of "Baa" or higher by the rating agency "Moody’s"; or
(b)
a rating of "BBB" or higher by the rating agency "Standard and Poor’s".
(4) The investment limits imposed on foreign currency denominated and overseas assets in the Schedule shall not apply to Synthetic Singapore Dollar Assets.
(5) In paragraph (4), "Synthetic Singapore Dollar Asset" means a foreign currency denominated fixed income or floating rate security that —
(a)
is fully hedged to the Singapore Dollar where —
(i)
any forward foreign exchange contract used for hedging matches the underlying foreign currency-denominated security in terms of cash flow and term-to-redemption; and
(ii)
any forward foreign exchange contract used for hedging is entered into with a financial institution licensed by the Authority that has an individual or financial strength rating of a category higher than "C", as accorded by the rating agency "Fitch Inc." or by the rating agency "Moody’s";
(b)
is accorded —
(i)
a rating of "Baa" or higher by the rating agency "Moody’s"; or
(ii)
a rating of "BBB" or higher by the rating agency "Standard and Poor’s"; and
(c)
has been classified by the insurer as a Synthetic Singapore Dollar Asset.