Singapore Banks become new shareholders of the CLS Group Singapore Dollar extends currencies for CLS Settlement

The three major Singapore Banks, Development Bank of Singapore (DBS Bank), Oversea-Chinese Banking Corporation Limited (OCBC Bank) and United Overseas Bank (UOB), have announced they have become shareholders of the CLS Group this month, bringing the total number of shareholders in the CLS Group to 70.

The three Singapore banks will in due course apply to become Settlement Members of CLS Bank International ("CLS Bank"), a "bankers' bank", which will provide a new global infrastructure for multi-currency payment clearing and settlement services. Institutions using CLS Settlement remove the temporal (so called "Herstatt") risk when settling foreign exchange transactions. Banks will be able to settle in a new real time five hour window which does not exist in today's markets, for the first time linking many of the world's Central Bank Real Time Gross Settlement (RTGS) systems and ultimately reducing the costs of cross-border transactions.

In addition, the Monetary Authority of Singapore (MAS) has today announced that it has received in-principle agreement from CLS Group and CLS Bank to include the Singapore Dollar as an eligible currency of CLS Bank.

The Singapore Dollar will join the Australian Dollar, Canadian Dollar, Danish Kroner, Euro, Japanese Yen, Norwegian Krone, Pound Sterling, Swedish Krona, Swiss Franc and United States Dollar as prospective CLS Bank Eligible Currencies. With the addition of the Singapore currency, CLS Bank will offer settlement facilities for currencies that are used in approximately 85% of all global foreign exchange trades.

Announcing the new shareholders and currency, Joseph De Feo, President and CEO of CLS Bank, said: "Singapore is a major player in global banking and financial services and the addition of Singapore banks to our list of shareholders and the Singapore Dollar to our prospective list of eligible currencies is a significant development for CLS Bank. This demonstrates the strength of support for CLS Bank amongst the global banking community."

Mr Enoch Ch'ng, Executive Director of the Market Infrastructure and Risk Advisory Department in MAS, said: "The increased consolidation of the global banking industry and growth in international trade have accentuated the need to mitigate the risks arising from foreign exchange transactions. As a small and open economy, and a major foreign exchange hub, a sound and efficient financial infrastructure is of strategic importance to Singapore. CLS Bank will eliminate settlement risk and facilitate cross border business globally, strengthening Singapore's role as a key financial centre. It will also enable the industry to leverage the infrastructure and make a greater impact on the regional and international stage."

Contact

• MAS:
  Diane Koh, Corporate Communications, +65 6229 9104



• DBS Bank:
  Eileen Lau, Group Communications, +65 6878 5398



• OCBC Bank:
  Loh Wei Ling, Corporate Communications, +65 6530 5926



• UOB:
  Samantha Joy Yik, Corporate Affairs, +65 6539 3970



• CLS Group:
  Jeffrey Manton, Communications Director,
  Julian Hargood, Communications Manager, +44 20 7971 5700/09



• Grandfield Public Relations:
  Nick Moreno/Mani Venmans, +44 20 7417 4170

Notes to Editors

Mr Alex Au, Vice-Chairman and CEO of OCBC Bank, said: "Settlement risk in cross-currency payments has been a concern to bankers and regulators alike for some time now. Being a shareholder in CLS will position OCBC Bank at the forefront of a global industry-wide initiative that is aimed at virtually eliminating such settlement risk. Our participation in the CLS system, taken together with inclusion of the Singapore Dollar, will thus serve to strengthen OCBC Bank's abilities to service the foreign exchange needs of our customers."

Mr Wee Ee Cheong, Deputy Chairman and President of the UOB Group, said: "We are pleased to support this initiative to reduce global foreign exchange settlement risk. Our participation in the global CLS settlement system, as a shareholder and settlement member, reflects our continuing focus on the effective management of risk in our business. It will enhance our overall risk framework and position ourselves to deliver quality products and services, as we build our business in the Asia-Pacific region."

About the Monetary Authority of Singapore
The Monetary Authority of Singapore ('MAS') is the central bank of Singapore. It formulates and executes Singapore's monetary policy, and is responsible for the development and promotion of Singapore as a financial center. As the banker and financial agent to the Singapore Government, MAS manages the country's official foreign reserves and issues government securities. MAS is also the supervisor and regulator of Singapore's financial services sector, overseeing the banking, securities, futures and insurance industries, and operates the Real-Time Gross Settlement (RTGS) system for high-value Singapore Dollar interbank payments, called the MAS Electronic Payment System (MEPS).

About DBS Bank
DBS Group Holdings Ltd. is the holding company of DBS Bank and is the largest banking group in Southeast Asia. Ranked among the top banks in Asia, DBS is a recognised leader in Internet banking and e-commerce. Beyond Singapore, DBS Group serves corporate, institutional and retail customers through subsidiaries and associated companies in Hong Kong, The Philippines, Indonesia and Thailand, and international banking services through a network of overseas branches and offices. With its acquisition of Dao Heng Bank in June 2001, DBS is the fourth largest bank in Hong Kong by assets. With Dao Heng, DBS' total assets stands at S$156 billion on June 30, 2001.

About OCBC Bank
Established in 1932, OCBC Bank's business offerings include consumer, corporate and international banking, investment management, global treasury, stockbroking and eFinancial services. The Bank has branches and representative offices in 13 countries, including Malaysia, China, Hong Kong SAR, Japan, Australia, UK and USA. In 2000, OCBC Bank achieved a profit attributable to shareholders of S$840 million. Its successful acquisition of Keppel Capital Holdings Limited and all its subsidiaries, including Keppel TatLee Bank Limited, in August 2001 represents the next step forward in OCBC Bank's mission to be a world-class financial institution in Asia Pacific. The Bank is committed to helping its customers, shareholders and staff grow from strength to strength by leveraging on its rich heritage, innovative spirit and forward-looking management.

About UOB
Founded in 1935 and listed on the Singapore Exchange since 1970, the United Overseas Bank (UOB) provides a wide range of financial services through its network of 240 offices around the world. As at 30 June 2001*, the UOB Group had total assets of S$68.4 billion and shareholders' funds of S$7.3 billion. It also achieved a net profit after tax of S$454.6 million for the first half of 2001. UOB's vision is to be a premier bank in the Asia-Pacific region, committed to providing quality products and excellent customer service. UOB recently acquired Overseas Union Bank of Singapore, creating a combined group with combined total assets of S$117.8 billion** and that is a pre-eminent bank in the Asia-Pacific region.
^*Unaudited figures of the UOB Group (standalone). **Unaudited proforma figures of the combined UOB Group and OUB Group as at 31 Dec 2000.

About CLS
'Continuous Linked Settlement' (CLS⧠is a process that enables two legs of a cross-currency transaction to be settled simultaneously. Representing a significant shift in the way cross border settlement has been done for centuries, it is a real-time, global settlement system that eliminates the settlement risk caused by delays arising from time-zone differences.

The continuous linked settlement service will be offered by CLS Bank International (CLS Bank), a "bankers' bank" that will provide a new global infrastructure for multi-currency payment clearing and settlement services, initially in foreign exchange.

CLS Group now has 70 shareholders. Together they account for a substantial majority of the cross-currency transactions across the globe and have invested more than $300 million to develop the settlement service.

CLS Bank is based in New York, regulated as a bank by the Federal Reserve Bank of New York, and is a wholly owned subsidiary of CLS Group Holdings, incorporated as CLS Services Ltd., a UK private company based in London.

Further information on CLS, including shareholder details, can be obtained at www.cls-services.com. CLS™ is a trademark of CLS Group Holdings (incorporated as CLS Services Ltd.)