PART III
FINANCIAL REQUIREMENTS
Minimum financial requirements for trust companies
11.—(1)  For the purposes of section 5(2) of the Act, the Authority shall not grant a trust business licence to a corporation unless the corporation satisfies the following requirement at the time of the grant:
(a)where the corporation is incorporated in Singapore, its paid-up capital is not less than $250,000;
(b)where the corporation is a foreign company, its qualifying assets are not less than $250,000.
(2)  For the purposes of paragraph (1)(b), the Authority may, from time to time and by notice in writing, specify the requirements relating to the qualifying assets referred to in that paragraph.
Maintenance of net asset value and qualifying assets
12.—(1)  A licensed trust company incorporated in Singapore shall at all times maintain a net asset value of not less than —
(a)where it does not have a financial year immediately preceding the current financial year, three-quarters of the minimum paid-up capital required under regulation 11; or
(b)in any other case —
(i)one-quarter of its relevant annual expenditure of the financial year immediately preceding the current financial year; or
(ii)three-quarters of the minimum paid-up capital required under regulation 11,
whichever is the higher amount.
(2)  A licensed trust company incorporated outside Singapore shall at all times maintain qualifying assets in the branch in Singapore, of not less than —
(a)where it does not have a financial year immediately preceding the current financial year, the minimum qualifying assets required under regulation 11; or
(b)in any other case —
(i)one-quarter of its relevant annual expenditure of the financial year immediately preceding the current financial year; or
(ii)the minimum qualifying assets required under regulation 11,
whichever is the higher amount.
(3)  For the purposes of paragraphs (1)(b)(i) and (2)(b)(i), the relevant annual expenditure of a licensed trust company for the financial year immediately preceding the current financial year means the total expenditure of the trust company for that year less the following :
(a)staff bonuses (except to the extent that they are guaranteed); and
(b)employees’ and directors’ shares in profits (except to the extent that they are guaranteed).
(4)  Any licensed trust company which contravenes paragraph (1) or (2) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $25,000.
Where net asset value or qualifying assets falls below required amount
13.—(1)  If a licensed trust company fails, or becomes aware that it will fail, to comply with regulation 12(1) or (2), as the case may be, the licensed trust company shall immediately notify the Authority in Form 2.
(2)  If the Authority is notified by a licensed trust company under paragraph (1) or becomes aware that the licensed trust company has failed to comply with regulation 12(1) or (2), as the case may be, the Authority may —
(a)direct the licensed trust company to immediately do one or more of the following:
(i)submit such statements or reports on a weekly basis or at such other intervals as the Authority may require until the licensed trust company meets the requirements in regulation 12(1) or (2), as the case may be;
(ii)operate its business in such manner and on such conditions as the Authority may impose; or
(b)revoke or suspend the licence of the licensed trust company under section 10(2)(d) of the Act.
(3)  The Authority may revoke or suspend the licence of a licensed trust company under section 10(2)(d) of the Act if the licensed trust company fails to comply with a direction issued to it by the Authority under paragraph (2)(a).
Professional indemnity insurance
14.—(1)  A licensed trust company shall maintain, at all times, a professional indemnity insurance policy that —
(a)covers all liabilities arising out of negligent discharge of the duties of the licensed trust company; and
(b)is commensurate with the levels of risk of the licensed trust company’s business.
(2)  The Authority may, at any time, by notice in writing, require the licensed trust company to satisfy the Authority that its professional indemnity insurance policy complies with the requirements of paragraph (1).
(3)  Any licensed trust company which contravenes paragraph (1) or (2) shall be guilty of an offence.