Singapore c.bank warns of downside risks to markets

SINGAPORE, July 14 (Reuters) - Singapore's central bank said it is closely monitoring financial markets in the wake of the crisis surrounding U.S. mortgage finance firms Fannie Mae FNM.N and Freddie Mac FRE.N, and warned of significant downside risks in global financial markets.

"Significant challenges and downside risks in the international financial markets remain and financial institutions and investors should stay vigilant," the Monetary Authority of Singapore said on Monday.

The U.S. Treasury and Federal Reserve called on Sunday for sweeping measures to lend money and buy equity, if necessary, in Fannie Mae and Freddie Mac, which own or guarantee $5 trillion in debt -- close to half the value of all U.S. mortgages.

The U.S. government plan to bolster the government-sponsored mortgage financiers helped calm markets on Monday, but did little to allay fears about the health of the U.S. financial system. [ID:nSP52252] (Reporting by Koh Gui Qing; Editing by Jan Dahinten)