(Bloomberg) -- Singapore’s longest-serving central bank chief ruled out entering politics after he steps down at the end of this year, departing from the route taken by some of his predecessors.
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“There are other good things you can do without becoming finance minister, although our finance minister does a very good job,” Monetary Authority of Singapore Managing Director Ravi Menon said in an interview with Bloomberg News on Oct. 27. Pressed by Bloomberg Television’s Haslinda Amin on whether a run for political office can be ruled out, he said “Oh, you can.”
Menon, 59, declared his lack of interest in joining politics in 2021 as well. Heng Swee Keat, Tharman Shanmugaratnam and Richard Hu served as finance ministers after leaving the central bank. Deputy Prime Minister Lawrence Wong, who’s also finance minister, is Prime Minister Lee Hsien Loong’s designated successor. The city state is due to hold a general election by November 2025, though polls could be held earlier.
Menon also discussed what’s next for him, the impact of a S$2.8 billion ($2 billion) money-laundering case on Singapore’s role as a wealth hub and digital assets.
What’s next for him:
“I’m only at the stage of figuring out what I’m interested in, and where I want to make a contribution. I’ve always had an interest in innovation and technology, in social inclusion, in climate action and sustainability. I hope to do something in these areas.”
Advice for his successor Chia Der Jiun:
“Never be afraid to change older decisions, including what I have done. Because we’re not going to improve if we don’t innovate and change things that need to be changed.”
On the impact of one of Singapore’s largest money laundering cases:
“There is no financial center that is 100% clean, so that cannot be the standard. But who actually looks for dirt and sweeps it away decisively? And I think we’ve done well on this.
“When you find dirt in your house, you then ask: Well, are there other corners that are not swept? So we are making a more thorough sweep.”
On whether one of Singapore’s largest money laundering cases has hit wealth inflows:
“So far, we’ve not seen any instance of what you would call ‘de-risking’. That means: ‘Oops, I’m not going to touch money from this source or this type of profile.’ Banks are too discerning to do that. But they are asking more questions, which I think is a good outcome.”
On whether more time will be needed for single family offices to get tax incentives after a few were embroiled:
“It depends on whether the banks, as a result of this, see that there is a necessity to ask more questions and drill more deeply. And so, in some cases, yes it could take longer.
“If it’s a well-known legitimate source of funds, very established credentials, the person or associated individuals have prior relationships with your bank, and you’ve already done some checks, then if they set up a family office then it’s quite straightforward.
“There will be more scrutiny in some cases. There’ll be greater sensitivity to the risks.”
On what’s next for family offices:
“Just because some of them set up single family offices doesn’t mean that there’s something wrong with the single family office space. What we have done, even before the money laundering case, is to make sure that all single family offices have a bank account here and are subject to controls by financial institutions here. That used to be a lacuna in the system.
“Previously, it was only the single family offices that qualified for the tax incentives, that we had placed this requirement on. We did that change just before. I’m glad we got the terrain covered.”
On the banks’ involvement:
“The fact that money was found in these banks in itself is not interesting. But what did you do about it when you suspected something? Did you look the other way and not do anything? In which case, no, that’s not good enough. You need to tighten up. But if you filed a report, you took risk mitigation or you closed the account. Now, that’s a good outcome.
“If there were lapses in their controls, in their risk management, definitely there will be repercussions. But it’s too early to tell right now. So we are going through this in a methodical way with the banks.”
On crypto regulation:
“Since the crypto exchanges are already here, we license them. That is the best way to exert our regulatory requirements on them to minimize consumer harm and also to ensure market integrity.”
--With assistance from Chanyaporn Chanjaroen, Haslinda Amin, Paul Dobson, Karthikeyan Sundaram, Suvashree Ghosh, Joyce Koh and Divya Balji.
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