Regulatory Safeguards that do not extend to AIs

For Clients of DBS Treasures, DBS Treasures Private Client and DBS Private Bank.

Where we deal with you as an Accredited Investor (AI), we would be exempt from complying with certain requirements under the Financial Advisers Act, Chapter 110 of Singapore (“FAA”) and certain regulations, notices and guidelines issued thereunder, as well as certain requirements under the Securities and Futures Act, Chapter 289 of Singapore (“SFA”) and certain regulations and notices issued thereunder.

Please note that the regulatory requirements that we are exempted from when dealing with you as an Accredited Investor may be amended and updated from time to time due to regulatory changes or otherwise. Any amendments and updates would be set out on this website.

Under the SFA and the regulations and notices issued thereunder:

  1. Compensation from fidelity fund under Section 186(1) of the SFA. The fidelity fund is established by an approved exchange (such as and including Singapore Exchange Securities Trading Limited, Singapore Exchange Derivatives Trading Limited, ICE Futures Singapore Pte. Ltd. and Asia Pacific Exchange Pte. Ltd.). Section 186(1) of the SFA provides for a fidelity fund to be held and applied for the purposes of compensating persons who suffer pecuniary loss because of certain defaults. Compensation may be made where there is a defalcation committed by a member of the approved exchange or its agent in the course of, or in connection with, a dealing in capital markets products done on the approved exchange or through a trading linkage of the approved exchange with an overseas exchange, where the defalcation is committed in relation to any money or other property which (after the establishment of the fidelity fund) was entrusted to or received by, inter alia, that member or by any of its agents for or on behalf of any other person or as trustee.

    When we deal with you as an Accredited Investor, you would not be entitled to be compensated from the fidelity fund, even if you have suffered pecuniary loss in the manner contemplated under Section 186(1) of the SFA. You are therefore not protected by the requirements of Section 186(1) of the SFA.
  1. Prospectus Exemptions under Sections 275 and 305 of the SFA. Under Part XIII of the SFA, all offers of securities and securities-based derivatives contracts, and units of collective investment schemes are required to be made in or accompanied by a prospectus in respect of the offer that is lodged and registered with the MAS and which complies with the prescribed content requirements, unless exempted. The SFA further provides for criminal liability for false and misleading statements contained in the prospectus, omissions to state any information required to be included in the prospectus or omissions to state new circumstances that have risen since the prospectus was lodged with the MAS which would have been required to be included in the prospectus if it had arisen before the prospectus was lodged with the MAS. In addition, certain persons, including the person making the offer, the issuer, the issue manager and the underwriter (the “Persons”) may be liable to compensate any person who suffers loss or damage as a result of the false or misleading statement in or omission from the prospectus, even if such persons were not involved in the making of the false or misleading statement or the omission.

    Sections 275 and 305 of the SFA are exemptions from the prospectus registration requirement under the SFA, and exempt the offeror from registering a prospectus when the offer of securities and securities-based derivatives contracts, and units of collective investment schemes is made to relevant persons. Relevant persons include Accredited Investors. In addition, secondary sales made to institutional investors and relevant persons, which include Accredited Investors, remain exempt from the prospectus registration requirement provided that certain requirements are met.

    Subsequent Sales: Subsequent sales of securities, securities-based derivatives contracts and collective investment schemes are subject to restrictions under Section 276(1) and 276(2) or, as the case may be, Sections 305A(1)(b) such that subsequent sales to relevant persons (including Accredited Investors) will continue to be exempt from prospectus requirements.

    Where securities, securities-based derivatives contracts and collective investment schemes are subscribed or purchased under Section 275 or 305 of the SFA by a relevant person which is:

    1. a corporation (which is not an Accredited Investor) the sole business of which is to hold investments and the entire share capital of which is owned by one or more individuals, each of whom is an Accredited Investor (the “Corporation”); or
    2. a trust (where the trustee is not an Accredited Investor) whose sole purpose is to hold investments and each beneficiary of the trust is an individual who is an Accredited Investor (the “Trust”),
    inter alia, securities of that corporation or the beneficiaries’ rights and interest (howsoever described) in that trust shall not be transferred within six months after that corporation or that trust has acquired the securities, securities-based derivatives contracts and collective investment schemes pursuant to an offer made under Section 275 or 305 of the SFA except, inter alia, to an institutional investor or to a relevant person.

    If you opt to be treated as an Accredited Investor, the above restrictions will not apply and you will not be prohibited from being a transferee of the securities of the Corporation or interests in the Trust in the circumstances specified.

    When we deal with you as an Accredited Investor, the issuer and/or offeror is exempt from the prospectus requirements under Part XIII of the SFA pursuant to the exemptions under Sections 275 and 305 of the SFA. As a result of this, the issuer and/or offeror is not under any statutory obligation to ensure that all offers of the relevant products to you are made in or accompanied by a prospectus that is lodged and registered with the MAS and which complies with the prescribed content requirements. Consequently, the issuer and/or offeror is not subject to the statutory prospectus liability under the SFA and you would not be able to seek compensation from the Persons under the civil liability regime for prospectuses even if you suffer loss or damage as a result of any false or misleading statement in or omissions in the offering document. Subsequent sales of securities, securities-based derivative contracts and collective investment schemes first sold under inter alia Section 275 and 305 can also be made to you, as well as transfers of securities of Corporations and interests in Trusts. You are therefore not protected by the prospectus registration requirements of the SFA.
  1. Restrictions on Advertisements under Sections 251 and 300 of the SFA. Sections 251 and 300 of the SFA prohibit any advertisement or publication referring to an offer or intended offer of securities and securities-based derivatives contracts, and units of collective investment schemes from being made, except in certain circumstances. In this regard, where a preliminary document has been lodged with the MAS, certain communications may be made. These include the dissemination of, and presentation of oral or written material on matters contained in, the preliminary document which has been lodged with the MAS to institutional investors and relevant persons under Sections 251(3), 251(4)(a), 300(2A) and 300(2B)(a) of the SFA. Relevant persons include Accredited Investors.

    When we deal with you as an Accredited Investor, you may receive communications relating to a preliminary document which has been lodged with the MAS. You are therefore not protected by the requirements of Sections 251 and 300 of the SFA.
  1. Part III of the Securities and Futures (Licensing and Conduct of Business) Regulations (“SFR”).

    Part III of the SFR stipulates the requirements imposed on us in relation to the treatment of customers’ assets. While we remain under the statutory obligation to deposit all assets received on your account in a custody account maintained in accordance with Regulation 27 of the SFR or any other account into which you direct the assets be deposited, as an Accredited Investor, the enhanced safeguards in relation to the assets that we receive on your account will not apply.

    We are also exempt from the following statutory obligations: (i) the disclosure requirements pertaining to the manner in which your assets are held (whether locally or in a foreign jurisdiction), as specified under Regulation 27A of the SFR; (ii) the prohibition against transferring title in your assets to us or any other person except in certain prescribed circumstances relating to the borrowing or lending of your specified products and using your assets to meet our own obligations under Regulation 34A and 35 of the SFR; (iii) the obligation to inform you that we may use your assets for a sum not exceeding the amount owed by you to us, disclose the risks of such use to you and obtain your consent before using your assets, including mortgaging, charging, pledging or hypothecating your assets.

    We have summarised the requirements below.

      Retail customer Accredited Investor
    Disclosure requirement The bank to make certain disclosures (such as whether the assets will be commingled with other customers and the risks of commingling, consequences if the institution which maintains the custody account becomes insolvent) in writing prior to depositing assets in custody account No such requirement
    Prohibition on transferring title of assets received from customer to the bank or any other person Prohibited unless transferred in connection with borrowing or lending of specified products in accordance with Regulation 45 of the SFR. No such requirement
    Withdrawals from custody account to transfer the asset to any other person or account in accordance with the written direction of the customer Not permitted to transfer retail customer’s assets, to meet any obligation of the bank in relation to any transaction entered into by the bank for the benefit of the bank. No such prohibition
    Customer Assets Deposit into a custody account maintained in accordance with Regulation 27 of the SFR (requires the custody account to be maintained with certain specified institutions only); or

    Deposit into account directed by retail customer to which retail customer has legal and beneficial title and maintained with, inter alia, licensed banks, merchant banks or finance companies or banks established and regulated as banks outside Singapore
    Deposit into a custody account maintained in accordance with Regulation 27 of the SFR (requires the custody account to be maintained with certain specified institutions only); or

    Deposit into account directed by Accredited Investor
    Mortgage of customer’s assets – The bank may mortgage, charge, pledge or hypothecate customer’s assets for a sum not exceeding the amount owed by the customer to the bank Prior to doing so, the bank must inform the retail customer of this right, explain the risks and obtain written consent of the retail customer No equivalent requirement
    When we deal with you as an Accredited Investor, we are exempt from treating you as a “retail investor” in relation to certain requirements stipulated under Part III of the SFR pertaining to the treatment of a retail customer’s assets. You are therefore not protected by those requirements under Part III of the SFR.
  1. Regulation 47BA of the SFR. Regulation 47BA of the SFR provides that a bank must not deal with a retail customer as an agent when dealing in capital markets products that are over-the-counter derivatives contracts and/or spot foreign exchange contracts, for the purposes of leveraged foreign exchange trading.

    When we deal with you as an Accredited Investor, we are exempt from treating you as a “retail investor” and may therefore deal with you as an agent in relation to over-the-counter derivatives contracts and/or spot foreign exchange contracts, for the purposes of leveraged foreign exchange trading.
  1. Regulation 47E of the SFR. Regulation 47E(1) and (2) of the SFR provide for certain risk disclosure requirements that a bank deals in capital markets products and provides fund management services respectively must comply with in relation to trading in futures contracts, spot foreign exchange contracts for the purposes of leveraged foreign exchange trading, and foreign exchange over-the-counter derivatives contracts for retail customers that are not related corporations of the bank.

    A bank that deals in capital markets products must not open a trading account for a retail customer who is not its related corporation for the purpose of entering into transactions of sale and purchase of the abovementioned capital markets products unless it has furnished the customer with a written risk disclosure document disclosing the material risks of the specified capital markets products in a prescribed form (Form 13), and receives an acknowledgement signed and dated by the customer that he has received and understood the nature and contents of the Form 13.

    A bank that provides fund management services shall not solicit or enter into an agreement with a prospective retail customer who is not its related corporation for the purpose of managing or guiding the retail customer’s trading account for the purposes of futures contracts, spot foreign exchange contracts for the purposes of leveraged foreign exchange trading, and foreign exchange over-the-counter derivatives contracts by means of a systematic programme that recommends specific transactions unless it has delivered the prospective retail customer with a written risk disclosure document in a prescribed form (Form 14), and received an acknowledgement signed and dated by the prospective retail customer that he has received and understood the nature and contents of the Form 14.

    Regulation 47E also specifies that copies of Forms 13 and 14 are kept in Singapore.

    When we deal with you as an Accredited Investor, we are not under any statutory obligation to provide you with the risk disclosures in the manner contemplated under Regulation 47E of the SFR. You are therefore not protected by the risk disclosure requirements under Regulation 47E of the SFR.
  1. Regulation 40 of the SFR. Regulation 40(1) of the SFR provides that a bank is required to furnish to each customer on a monthly basis a statement of account containing certain particulars prescribed under Regulation 40(2) of the SFR. In addition, Regulation 40(3) of the SFR provides that a bank is required to furnish to each customer, at the end of every quarter of a calendar year, a statement of account containing, where applicable, the assets, derivatives contracts of the customer and spot foreign exchange contracts for the purposes of leveraged foreign exchange trading of the customer that are outstanding and have not been liquidated and cash balances (if any) of the customer at the end of that quarter.

    When we deal with you as an Accredited Investor and provided we have made available to you (on a real-time basis) the prescribed particulars in the form of electronic records stored on an electronic facility and you have consented to those particulars being made available in this manner or you have requested in writing not to receive the statement of account, we are not under any statutory obligation to furnish a monthly or quarterly statement of account to you. You are therefore not protected by the requirements of Regulations 40(1) and (3) of the SFR.
  1. Regulation 45 of the SFR. Regulation 45 of the SFR provides that borrowing and lending of specified products by a bank (i) must be recorded in a prior written agreement between the bank and the lender or borrower or their duly authorised agent where such agreement includes certain prescribed details; and (ii) must be collateralised. In particular, the bank is required to ensure that the collateral provided must, throughout the period that the specified products are borrowed or lent, have a value of not less than 100% of the market value of the specified products borrowed or lent. Regulation 45 of the SFR further sets out the acceptable forms of collateral for these purposes.

    When we deal with you as an Accredited Investor, we are not under any statutory obligation to provide collateral to you under Regulation 45 of the SFR when we borrow specified products from you. You are therefore not protected by the collateral requirements under Regulation 45 of the SFR when you lend specified products to us. Where we provide assets to you as collateral for the borrowing, the written agreement for shall specify whether the specified products borrowed and the assets provided comprising specified products (if any) are marked to market and if so, the procedures for calculating the margin. However (unlike for retail investors), the agreement does not have to include the requirement to mark-to-market on every business day the specified products that are borrowed or lent nor the minimum Collateral comprising specified products and the procedures for calculating the margins.
  1. Regulation 47DA of the SFR. Regulation 47DA(1) and (2) of the SFR provide for certain general risk disclosure requirements that a bank dealing in specified capital markets products must comply with. For this purpose, “specified capital markets products” means capital markets products other than futures contracts, spot foreign exchange contracts for the purposes of leveraged foreign exchange trading and foreign exchange over-the-counter derivatives contracts. In particular, the bank must not open a trading account for a customer for the purpose of entering into transactions of sale and purchase of any specified capital markets products unless it has furnished the customer with a written risk disclosure document disclosing the material risks of the specified capital markets products, and receives an acknowledgement signed and dated by the customer that he has received and understood the nature and contents of the risk disclosure document. Further, the bank must not enter any transaction of sale or purchase of any specified capital markets products unless it has informed the customer whether it is acting in that transaction as a principal or agent and/or its intention to do so.

    When we deal with you as an Accredited Investor, we are not under any statutory obligation to provide you with the risk disclosures, and the capacity in which we act, in the manner contemplated under Regulation 47DA of the SFR. You are therefore not protected by the requirements under Regulation 47DA of the SFR.
  1. Regulation 28 of the FAR. Regulation 28 of the FAR provides an exemption to a corporation, not being a licensed financial adviser or an exempt financial adviser, which carries on the business of advising others either directly or through publications or writings or by issuing or promulgating research analyses or research reports, concerning bonds to an expert investor or an Accredited Investor, from having to hold a financial adviser’s licence in respect of the above-stated activity.

    Regulation 28 also exempts certain exempt financial advisers from having to comply with requirements set out in sections 26 to 29 and 36 of the FAA. Briefly, these requirements are as follows. Section 26 of the FAA imposes an obligation on a financial adviser not to make any false or misleading statement or to employ any device, scheme or artifice to defraud. Section 27 of the FAA requires a financial adviser to have a reasonable basis for any recommendation on an investment product that is made to a client. Section 28 of the FAA provides that the MAS may by regulations determine the manner in which a financial adviser may receive or deal with client’s money or property or prohibit a financial adviser from receiving or dealing with client’s money or property in specified circumstances or in relation to specified activities. Section 29 imposes an obligation on a financial adviser to furnish information about any matter related to its business to the MAS if required by MAS for the discharge of its functions under the FAA. Section 36 of the FAA provides for certain disclosure of interest requirements when a financial adviser sends a circular or other written communication in which a recommendation is made in respect of specified products (i.e. securities, specified securities-based derivatives contracts or units in a collective investment scheme).

    When we deal with you as an Accredited Investor, in the course of us providing advice or analyses on bonds, we will not be required to comply with the requirements set out in sections 26 to 29 and 36 of the FAA. You are therefore not protected by these requirements.
  1. Regulation 32C of the FAR. Regulation 32C of the FAR exempts a foreign research house from having to hold a financial adviser’s licence in respect of advising others by issuing or promulgating any research analyses or research reports concerning any investment product to any investor under an arrangement between the foreign research house and a financial adviser in Singapore, subject to certain conditions. These include a condition that where the research analysis or research report is issued or promulgated to a person who is not an Accredited Investor, expert investor or institutional investor, the analysis or report must contain a statement to the effect that the financial adviser in Singapore accepts legal responsibility for the contents of the analysis or report without any disclaimer limiting or otherwise curtailing such responsibility.

    When we deal with you as an Accredited Investor, we need not expressly accept legal responsibility for the contents of any research analysis or research report issued or promulgated to you pursuant to an arrangement between us and a foreign research house. We are also not limited by the requirement to not include a disclaimer limiting or otherwise curtailing such legal responsibility. You are therefore not protected by these requirements under Regulation 32C of the FAR.
  1. Section 25 of the FAA and MAS Notice on Information to Clients and Product Information Disclosure [Notice No. FAA-N03]. Section 25 of the FAA imposes an obligation on a financial adviser to disclose to its clients and prospective clients all material information relating to any designated investment product recommended by the financial adviser, and provides that MAS may prescribe the form and manner in which the information shall be disclosed. “Material information” includes the terms and conditions of the designated investment product and the benefits and risks that may arise from the designated investment product.

    The MAS Notice on Information to Clients and Product Information Disclosure [Notice No. FAA-N03] sets out the standards to be maintained by a financial adviser and its representatives with respect to the information they disclose to clients. The Notice also sets out the general principles that apply to all disclosures by a financial adviser to its clients and the specific requirements as to the form and manner of disclosure that the financial adviser has to comply with in relation to, among others, section 25 of the FAA.

    As a result of our exemption from compliance with these requirements when we deal with you as an Accredited Investor, we are not under any statutory obligation to provide you with all material information on any designated investment product in the prescribed form and manner, e.g. the benefits and risks of the designated investment product and the illustration of past and future performance of the designated investment product. You are therefore not protected by the disclosure requirements in section 25 of the FAA and MAS Notice on Information to Clients and Product Information Disclosure [Notice No. FAA-N03].
  1. Section 27 of the FAA and MAS Notice on Recommendations on Investment Products [Notice No. FAA-N16]. Section 27 of the FAA requires a financial adviser to have a reasonable basis for any recommendation on an investment product that is made to a client. The financial adviser is required to give consideration to the investment objectives, financial situation and particular needs of the client, and to conduct investigation on the investment product that is the subject matter of the recommendation, as is reasonable in all the circumstances. Failure to do so could, if certain conditions are satisfied, give the client a statutory cause of action to file a civil claim against the financial adviser for investment losses suffered by the client. The conditions are that the client suffers loss or damage as a result of doing a particular act (or refraining from doing a particular act) in reliance on the recommendation, where it is reasonable (having regard to the recommendation and all other circumstances) for the client to have done so in reliance on the recommendation.

    The MAS Notice on Recommendations on Investment Products [Notice No. FAA-N16] sets out requirements which apply to a financial adviser when it makes recommendations on investment products to its clients. In particular, the Notice sets out: (i) the type of information the financial adviser needs to gather from its client as part of the “know your client” process; (ii) the manner in which the financial adviser should conduct its analysis of the client’s financial needs and how it should present its investment recommendations; and (iii) documentation and record keeping requirements relating to this process.

    As a result of our exemption from compliance with these requirements when we deal with you as an Accredited Investor, we are not under any statutory obligation to ensure that we have regard to the information possessed by us concerning your investment objectives, financial situation and particular needs and have given consideration to and conducted investigation of the subject matter of any recommendation, and that the recommendation is based on such consideration and investigation. We are also not statutorily required to conduct a Customer Knowledge Assessment* to determine your investment experience and knowledge, nor are we required to comply with the Procedures. Further, you will not be able to rely on section 27 of the FAA in any claim against us for losses that may be suffered in respect of any investment that we may have recommended to you. You are therefore not protected by the requirements of section 27 of the FAA and MAS Notice on Recommendations on Investment Products [Notice No. FAA-N16].
  1. Section 36 of the FAA. Section 36 of the FAA provides that when sending a circular or other written communication in which a recommendation is made in respect of specified products (i.e. securities, specified securities-based derivatives contracts or units in a collective investment scheme), a financial adviser is required to include a concise statement, in equally legible type, of the nature of any interest in, or any interest in the acquisition or disposal of, those specified products that it or any associated or connected person has at the date on which the circular or other communication is sent. Such circular or written communication must be retained by the financial adviser for five years.

    As a result of our exemption from compliance with section 36 of the FAA when we deal with you as an Accredited Investor, we are not under any statutory obligation to include such a statement of interest in specified products in any written recommendation or document that we may send to you. You are therefore not protected by the requirements of section 36 of the FAA if no disclosure is made of any interest that we or any associated or connected person may have in the specified products that we may recommend in such document.
  1. Sections 38 and 39 of the FAA, and MAS Notice on Requirements for the Remuneration Framework for Representatives and Supervisors (“Balanced Scorecard Framework”) and Independent Sales Audit Unit [Notice No. FAA-N20] (“BSC Notice”) and MAS Guidelines on the Remuneration Framework for Representatives and Supervisors (“Balanced Scorecard Framework”), Reference Checks and Pre-Transaction Checks [Guideline No. FAA-G14] (“BSC Guidelines”)*. Section 38 of the FAA provides that a financial adviser must establish and maintain a remuneration framework that contains terms consistent with the requirements prescribed by MAS for the purpose of (a) reviewing and assessing the performance of its representatives and supervisors; and (b) determining the remuneration of its representatives and supervisors. The financial adviser must review and assess the performance, and determine and pay the remuneration, of its representatives and supervisors in accordance with such remuneration framework.

    Section 39 of the FAA provides that a financial adviser must have an independent sales audit unit that reports to the board of directors and chief executive officer of the financial adviser or such unit determined by the board of directors or chief executive officer which is independent from all units of the financial adviser which provide financial advisory services. Such independent sales audit unit is required to audit the quality of the financial advisory services provided by the representatives of the financial adviser and to carry out the functions and duties prescribed by MAS, in the prescribed manner.

    The BSC Notice sets out the requirements in relation to the design and operation of the balanced scorecard framework which a financial adviser is required to put in place in their remuneration structures for their representatives and supervisors, and the independent sales audit unit. The BSC Guidelines provide general guidance on some of the requirements of the BSC Notice, such as the post-transaction checks and classification of infractions by the independent sales audit unit. In addition, the BSC Guidelines set out the measures to be applied to all existing and newly recruited representatives who have been assigned a balanced scorecard grade of “E” and all supervisors who have been assigned a balanced scorecard grade of “Unsatisfactory” under the balanced scorecard framework, as well as obtaining and sharing of information on the representatives’ and supervisors’ balanced scorecard grades during reference checks. The BSC Guidelines also set out the MAS’ expectation for a financial adviser to conduct pre-transaction checks to minimise the impact of the balanced scorecard framework on its representatives and supervisors.

    As a result of our exemption from compliance with these requirements when we deal with you as an Accredited Investor, we are not under any statutory obligation to either (a) establish or maintain such a remuneration framework, or to review and assess the performance, and determine and pay the remuneration, of our representatives and supervisors in accordance with such a remuneration framework, or (b) to have an independent sales audit unit to audit the quality of the financial advisory services provided by our representatives. You are therefore not protected by the requirements of sections 38 and 39 of the FAA, the BSC Notice and the BSC Guidelines*.
  1. Regulation 18B of the FAR. Regulation 18B of the FAR provides that before selling or marketing certain new products, a financial adviser is required to carry out a due diligence exercise to ascertain whether such new product is suitable for the targeted client. The due diligence exercise must include an assessment of several areas, including (i) an assessment of the type of targeted client the new product is suitable for and whether the new product matches the client base of the financial adviser; (ii) the key risks that a targeted client who invests in the new product potentially faces; and (iii) the processes in place for a representative of the financial adviser to determine whether the new product is suitable for the targeted client, taking into consideration the nature, key risks and features of the new product. The financial adviser is prohibited from selling or marketing any new product to any targeted client unless every member of its senior management has, on the basis of the result of the due diligence exercise, personally satisfied himself that the new product is suitable for the targeted client and personally approved the sale or marketing of the new product to the targeted client. “Targeted client” excludes Accredited Investors.

    As a result of our exemption from compliance with Regulation 18B of the FAR when we deal with you as an Accredited Investor, we are not under any statutory obligation to carry out a due diligence exercise to ascertain whether any new product we wish to sell or market to you is suitable for you. You are therefore not protected by the requirements of Regulation 18B of the FAR.

* Requirements only apply to customers who are natural persons.

 

Frequently Asked Questions

Regulatory Changes

The Monetary Authority of Singapore has recently implemented legislative amendments aimed at enhancing regulatory safeguards for investors. The criteria for an investor to qualify as an AI has been refined and with effect from 8 January 2019, the introduction of an opt-in regime will provide investors the option of electing for AI status.

DBS is required to independently assess the AI eligibility of its clients. For the criteria and supporting documents to qualify as an AI, please refer to Questions 2 and 3 respectively.

While the effective date is 8 January 2019, DBS will have up to 7 April 2019 as a transition period for its clients to provide relevant supporting documentation and/or opt in for AI status under the new AI regime. For what it means to be a non-AI, please refer to Question 5.


The prescribed AI wealth or income thresholds are as follows:

Qualification for Accredited Investors (AI) Status

Individuals

  • Net personal assets (“NPA”) exceed S$2 million (or its equivalent in a foreign currency), but net equity of primary residence capped at S$1 million of the S$2 million threshold1 ; or
  • Net financial assets2 (“NFA”) (net of any related liabilities) exceed S$1 million (or its equivalent in a foreign currency); or
  • Income in the preceding 12 months is not less than S$300,000 (or its equivalent in a foreign currency); or
  • A person who holds a joint account with an Accredited Investor, in respect of dealings through that joint account3 .

Corporations

  • Net assets exceed S$10 million (or its equivalent in a foreign currency)4 ; or
  • Entire share capital is owned by one or more persons, each of whom is an AI.

Entity (other than a corporation)

Net assets exceed S$10 million (or its equivalent in a foreign currency)

Partnership (other than limited liability partnership)

Each partner is an AI

Trustee of Trust, when acting in that capacity where

  • Trust property exceeds $10 million in value (or its equivalent in a foreign currency); or
  • All beneficiaries of the trust are AIs; or
  • All settlors are AIs and have settlor reserved investment powers and revocation powers.

The supporting documents required may include the following:

Qualification for Accredited Investors (AI) Status
Individuals / Joint Accounts / Partnership

For NPA / NFA5 :

  • Latest bank statements
  • Bank reference letter

For net equity of property:

  • Property or land title deed
  • Valuation report
  • Mortgage loan

For income:

  • Salary slip
  • Latest Notice of Assessment or overseas tax authorities’ returns
  • Letter from employer certifying individual’s income in the preceding 12 months
  • Confirmation from tax adviser or accountant on individual’s income in the preceding 12 months
Corporations
  • Latest financial statements (audited or certified by a Director)
  • Where all shareholders are AIs, please refer to the section on “Individuals” above.
Entity (other than a corporation)
  • Latest financial statements (audited or certified by a Director or equivalent officer)
Trustee of Trust
  • Declaration from professional trustee
  • Latest bank statements or bank reference letter
  • Where all beneficiaries or settlors are AIs, please refer to the section on “Individuals” above.

An AI generally has access to a wider range of financial products and services.

AIs are assumed to be better informed, and better able to access resources to protect their own interests, and therefore require less regulatory protection. Investors who agree to be treated as AIs therefore forgo the benefit of certain regulatory safeguards. For example, issuers of securities are exempted from issuing a full prospectus registered with the Monetary Authority of Singapore in respect of offers that are made only to AIs, and intermediaries are exempted from a number of business conduct requirements when dealing with AIs. Investors should consult a professional adviser if they do not understand any consequence of being treated as an AI.

For details on the relevant regulatory requirements which we will be exempted from when serving you as an AI, please refer to go.dbs.com/sg-accreditedinvestor


Generally, a non-AI has access to a limited range of financial products and services as compared to those available to an AI.

For DBS Private Bank and Treasures Private Client

If you do not opt in for AI status, DBS will be required to treat you as a Non-Accredited Investor (“Non-AI”) from 7 April 2019. DBS Private Bank and Treasures Private Client may continue to serve you as a High Net Worth Individual after such date until we notify you otherwise. However, there may be limitations on new investment products that we may offer to you as a non-AI.

For DBS Treasures

If you do not opt in for AI status, we will be required to serve you as a Non-AI from 7 April 2019. There may be limitations on the new investment products that we may offer to you. However, we shall continue to provide services to you for your existing investments.


AI status is held on a per financial institution basis. If you opt in for AI status, this will be applied to all DBS account(s) which are held in your name.

The only exception is in respect of Non-AIs who maintain joint accounts with at least one (1) account holder who is an AI. For such cases, if there is at least one (1) AI individual account holder, the non-AI account holders may opt in to be treated as an AI but only in respect of dealings through that joint account. Refer to Question 7 for more details.


If all joint account holders individually qualify and have opted in for AI status, all joint account holders may be treated as an AI in respect of dealings through that joint account.

For accounts where one or more joint account holders are non-AI, the joint account may be treated as AI if:

  1. at least one joint account holder has been assessed to meet the AI-eligibility criteria and has opted in to be treated as an AI; and
  2. all joint account holders opt in to be treated as AIs in respect of dealings through the joint account only. You may opt in for your joint account by contacting your Relationship Manager .

Opt In Request

If you meet the pre-requisites to qualify as an AI and would like to opt in to be treated as an AI for your account(s), please:

  1. Submit supporting documents (refer to Question 3); and
  2. Complete and return the accompanying Application to Opt-In to Accredited Investor Status (Schedule II).

Alternatively, you may contact your Relationship Manager who would be able to assist you with the opt in request. DBS will assess your AI-eligibility and notify you when your opt in request has been successfully processed.

Existing AI - Opt Out Request

Existing AI clients may opt out of the AI status at any time. If you are an existing AI and wish to opt out of the AI status, please complete and return the accompanying Request to Opt-Out of Accredited Investor Status (Schedule II). Do note DBS may take approximately 14 days to process your request. DBS will notify you once your request has been processed and your investor status has been updated in DBS’ records. Until such time, you would still be considered an AI.

Existing AI (Individuals Only)

Unless you opt out of AI status, DBS may continue serving you as an AI until 8 July 2020. For DBS to continue serving you as an AI after 8 July 2020, please inform your Relationship Manager or complete and return the accompanying Application to Opt-In to Accredited Investor status (Schedule II) before 8 July 2020.

Notification and Updates

DBS may take approximately 14 days to process your request. DBS will notify you once your request has been processed and your investor status has been updated in DBS’ records.

1An individual’s primary residence refers to where the individual lives in most of the time and –

  1. is to be calculated by deducting any outstanding amounts in respect of any credit facility that is secured by the residence from the estimated fair market value of the residence; and
  2. is taken to be the lower of the following:
    1. the value calculated under paragraph (1);
    2. S$1 million.

2Where “financial asset” means:

  1. a deposit as defined in section 4B of the Banking Act;
  2. an investment product as defined in section 2(1) of the Financial Advisors Act, which includes securities, securities-based and other derivatives contracts, collective investment schemes, and life policies; or
  3. any other asset as may be prescribed by regulations made under section 341 of the Securities and Futures Act; or

3Please refer to Question 7 for the criteria for joint accounts to qualify for AI status.

4Net assets as determined by:

  1. the most recent audited balance-sheet of the corporation; or
  2. where the corporation is not required to prepare audited accounts regularly, a balance-sheet of the corporation certified by the corporation as giving a true and fair view of the state of affairs of the corporation as of the date of the balance-sheet, which shall be a date within the preceding 12 months.

5Documents are only required to support NPA / NFA in excess of net assets under management (“AUM”) with DBS. For example, if you have net AUM of S$800,000 with DBS, you will only need to provide supporting documents in respect of the balance of S$200,000 to evidence NFA of S$1 million.

6DBS Private Bank and Treasures Private Client has been granted an exemption for specialised units serving High Net Worth Individuals under Section 100(2) of the Financial Advisers Act. Please refer to clause 2 of Part B of the Terms and Conditions (https://www.dbs.com.sg/iwov-resources/docs/footer/pb-rebranding-acc-open-tnc-v9bf.pdf) for details of the exemption.

7“High Net Worth Individual” is as defined in the MAS Guidelines on Exemption for Specialised Units Serving High Net Worth Individuals under Section 100(2) of the Financial Advisers Act and means any of the following:

  1. an individual who has a minimum of S$1 million of assets, or the equivalent in foreign currencies, in any or all of the following forms: (i) bank deposits, including structured deposits; (ii) capital markets products; (iii) life policies; (iv) other investment products as may be prescribed by MAS
  2. an individual whose total net personal assets exceed S$2 million in value or the equivalent in foreign currencies;
  3. an individual whose annual income is not less than S$300,000 or the equivalent in foreign currencies; or
  4. an individual who is assessed by the applicant to have the potential to become a person described in (a) within a period of 2 years.