Singapore is well positioned to weather spillover effects of the normalisation of monetary policy in the advanced economies and the banking system is likely to stay resilient even under extreme stress.
This is according to the Monetary Authority of Singapore’s annual Financial Stability Review. But the central bank warned that the normalisation of monetary policy in the G3 could have a “substantial impact” on Asia and Asian banking systems, including tighter financial conditions and volatile capital flows.
Under the annual review, banks in Singapore were stress-tested on scenarios which include a contraction in Singapore’s GDP for three consecutive years, rising unemployment, and property prices falling by more than what was experienced during the Asian financial crisis.
Channel NewsAsia 
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