Singapore regulator warns DBS Bank over prolonged service outage

Singapore’s DBS Bank on Thursday struggled to bring a three-day service outage under control in an embarrassment for south-east Asia’s biggest lender and for the city state’s ambitions as a regional financial centre.

Customers of DBS, which has said it is transforming to become “digital to the core”, have struggled to make transactions on the bank’s website and mobile app since Tuesday in the lender’s worst service outage in a decade.

The bank said on Wednesday that digital services were “returning to normal” on Twitter but customers were still complaining they were having issues on Thursday. Singapore regulators warned the lender over the “serious” incident.

“I can’t pay my dbs credit card bills. You had better not charge me a late fee,” said one user in response to the bank’s tweet.

DBS is an important part of the Monetary Authority of Singapore’s vision of developing a “smart” financial sector in the city state through the seamless use of technology. The goal is to gain an edge for business over rival Asian financial hubs in Hong Kong and Tokyo.

The MAS late on Wednesday said it expected the Singapore lender to conduct a “thorough investigation” of the incident and said it would consider taking action against DBS.

“MAS will consider appropriate supervisory actions following the investigation,” said Marcus Lim, assistant managing director of banking and insurance at the MAS.

DBS’s Singapore-listed shares have fallen 1.5 per cent since Tuesday morning.

DBS was also forced to deny speculation the disruption was linked to a bond sale by Myanmar’s National Unity Government, a shadow government set up by supporters of Aung San Suu Kyi, the country’s elected leader who was toppled by a military coup.

Singapore is Myanmar’s largest source of overseas financing and many Myanmar investments are channelled via multinational and foreign companies based in the city-state.

“There have been rumours that DBS’s digibanking service disruption is linked to the sale of treasury bonds by Myanmar’s National Unity Government. There is no truth to this. DBS has not sold any such bonds,” said DBS.

The bank’s last comparable disruption was in 2010 when a systems failure brought all consumer and business banking services to a halt.

The outages come as DBS expects increased competition next year from new digital rivals. Singapore’s big three banks — DBS, UOB and OCBC — collectively hold the majority of the island’s deposit base but Singapore late last year awarded digital bank licences to Asian technology companies. These included New York-listed gaming and ecommerce giant Sea, China’s Ant Group and south-east Asian super app Grab.

Incumbent banks have since poured in more cash to strengthen their digital offerings.

“It probably won’t do long-term damage but it is an embarrassing fiasco right before we see some of the new players launch,” said one financial analyst.

Source link

Leave a Reply

Your email address will not be published. Required fields are marked *