(Corrects last paragraph to better reflect what MAS said about Sibor panel)
SINGAPORE, July 25 (Reuters) - Singapore’s central bank said on Wednesday it has ordered banks in the city-state to review the way benchmark interbank borrowing rates are set as regulators worldwide scrutinise the troubled Libor system.
“We’ve directed the banks to take a look at their processes and have an independent review done,” Teo Swee Lian, deputy managing director of the Monetary Authority of Singapore (MAS), told a press conference.
Regulators in Singapore and other major financial centres are looking into reforming interbank borrowing rates following suspected rigging of the London interbank offered rate (Libor).
Teo said the MAS’s main concerns focus on the Singapore interbank offered rate (Sibor) and the Singapore swap offer rate (SOR), the two main benchmarks used to determine mortgage loans in the city-state. But all rates set by a similar process will be reviewed, he added.
Last week, Royal Bank of Scotland said it had removed itself from the Association of Banks in Singapore (ABS) panel that sets the city-state’s benchmark interbank rate.
The MAS said ABS did not expect further withdrawals of banks from the panel. (Reporting by Kevin Lim; Writing by Rachel Armstrong; Editing by John O‘Callaghan)