MAS revises requirements for Additional Tier 1 and Tier 2 capital instruments for banks in Notice 637, defers implementation of prudential treatment and disclosures of cryptoasset exposures

29 October 2025

On 9 October 2025, the Monetary Authority of Singapore (“MAS”) issued MAS Notice 637 (Amendment) 2025, which amends MAS Notice 637 on Risk Based Capital Adequacy Requirements for Banks Incorporated in Singapore (“Notice 637”) to revise the minimum requirements for Additional Tier 1 (“AT 1”) and Tier 2 capital relating to the type of investors they are issued to and to enhance the clarity of Notice 637.

Background

MAS published a consultation paper on 27 March 2025 seeking feedback on:

  • amendments to various MAS notices to implement the standards relating to the prudential treatment and disclosures of cryptoasset exposures (“cryptoasset standards”) published by the Basel Committee on Banking Supervision (“BCBS”); and
  • amendments to Notice 637 to (i) revise the minimum requirements for Additional Tier 1 (“AT1”) and Tier 2 capital relating to the type of investors they are issued to; and (ii) enhance the clarity of requirements on the computation of the capital conservation buffer and countercyclical buffer and the recognition of credit risk mitigation under synthetic securitisations.

MAS published its response to the feedback received on 9 October 2025, stating that the revised Notice 637 incorporates feedback where appropriate.

Amendments to Notice 637

MAS Notice 637 (Amendment) 2025 includes amendments to:

  • incorporate the BCBS’ revised methodology used to calculate interest rate shocks in the interest rate risk in the banking book (“IRRBB”) standard and update the IRRBB standardised interest rate shock scenarios based on the revised methodology;
  • revise the minimum requirements for AT 1 and Tier 2 capital instruments to disqualify AT1 or Tier 2 capital instruments which are issued to retail investors in Singapore as regulatory capital;
  • enhance the clarity of the following requirements:
  • computation of the capital conservation buffer and countercyclical buffer;
  • recognition of credit risk mitigation under synthetic securitisations; and
  • implement various other technical revisions.

The amendments will take effect from 1 January 2026, except for amendments in Annex 10C of Part X to incorporate BCBS’ revised methodology used to calculate interest rate shocks in the IRRBB standard and update the IRRBB standardised interest rate shock scenarios based on the revised methodology. The amendments in Annex 10C of Part X will come into effect from 31 December 2025.

Deferral of implementation of prudential treatment and disclosures of cryptoasset exposures

After considering feedback, MAS will defer the implementation of the prudential treatment and disclosures of cryptoasset exposures to 1 January 2027 or later. MAS will provide updates on the final cryptoasset standards and implementation date in due course.

In the interim, from now up till the implementation date of the cryptoasset standards, banks with cryptoasset exposures or intending to take on cryptoasset exposures must notify and engage MAS on the appropriate prudential treatment for their cryptoasset exposures. During this period, MAS will expect banks to apply a prudential treatment for their cryptoasset exposures that would largely be aligned with the provisions set out in the consultation paper.

Reference materials

The following materials are available on the MAS website www.mas.gov.sg: