MAS net profit drops to 5.3 billion Singaporean dollars due to strong Sing dollar

SINGAPORE: The Monetary Authority of Singapore (MAS) achieved a net profit of 5.3 billion Singaporean dollars during the previous fiscal year, according to its annual report for the fiscal year 2017/18 published Wednesday, July 4th.

This figure, which excludes a $ 1.1 billion contribution to the Consolidated Fund, is lower than the record net income of $ 24.3 billion last year, with negative exchange rate effects partially offsetting interest income and investments.

For the fiscal year ended March 31, 2018, MAS realized a gain of 8.5 billion Singapore dollars on the investments of its official foreign exchange reserves (RFA).

While OFRs recorded "solid" gains of $ 22.3 billion as world markets continued to recover, $ 13.8 billion of negative currency effects were incurred by the dollar Singaporean against the US dollar and the Japanese yen.

Compared to the $ 30.1 billion investment gain realized during the fiscal year 2016/17, aided by higher investment returns and depreciation of the sing dollar against to some major currencies

"Investment gains … are inherently volatiles, "said MAS General Director Ravi Menon.

"The best way to interpret the number is to look at the 10-year average (which is a) good judgment of the types of investment gains that MAS achieves over a long-term period of time. Year after year, there will be fluctuations. "

Over the past 10 years, investment gains, net of currency effects, averaged $ 12.1 billion. Singapore dollars per year, according to the annual report.

At the end of March 2018, MAS held $ 376.5 billion worth of petroleum products in its balance sheet. This is invested in a well diversified portfolio, consisting of different asset classes across different geographies, for good long-term returns and good resistance to market conditions.

About three-quarters of MAS's portfolio is denominated in US dollars, euros, yen, and pounds sterling, with the greenback making up the bulk. According to the central bank, investment-grade bonds in advanced economies are the biggest allocation in the portfolio.