Global Trustee and Fiduciary Services Bite Sized Issue 12 2024

15 QUICK LINKS COSTS & CHARGES CSDR CRYPTOASSETS EMIR FINTECH FSB FUND LIQUIDITY MIFID II/MIFIR NBFI OPERATIONAL RESILIENCE SUSTAINABLEFINANCE/ESG T+1 ASIA NORTH AMERICA UNITED KINGDOM Global Trustee and Fiduciary Services Bite-Sized | Issue 12 | 2024 ASIA MAS Rationalises Leverage Requirements and Introduces Additional Disclosures for REITs On 28 November 2024, the Monetary Authority of Singapore (MAS) issued revisions to the Code on Collective Investment Schemes (Code) to rationalise leverage requirements for the real estate investment trust (REIT) sector. To rationalise requirements, a minimum interest coverage ratio (ICR) of 1.5 times and a single aggregate leverage limit of 50%will be applied to all REITs with immediate effect. The previous requirement was that a minimum ICR of 2.5 times was imposed only on REITs which intended to increase their aggregate leverage from 45% to 50%. The MAS says the ICR and leverage requirements will work together to foster prudent borrowing by all REITs while offering operational flexibility. Maintaining a minimum ICR of 1.5 times at all times underscores the responsibility of REIT managers in ensuring that REITs can adequately meet all interest payments, complemented by a leverage limit of 50% that is among the strictest globally. To enhance accountability in REITs’ financial management, REITs will be required to provide additional disclosures concerning the outlook and management of their leverage and ICR levels in their financial result announcements and annual reports. The following stepped-up disclosures will apply from financial periods ending on or after 31 March 2025 onwards: • REITmanagers should disclose generally how they intend tomanage REITs’ leverage and ICR levels. • REITs should also perform and disclose sensitivity analyses on the impact of changes in EBITDA (earnings before interest, tax, depreciation and amortisation, excluding effects of any fair value changes of derivatives and investment properties, and foreign exchange translation) and interest rates on REITs’ ICRs. The sensitivity analyses should minimally include two separate scenarios, one based on a 10% decrease in EBITDA and another based on a 100-basis point increase in interest rates. • Where the ICR of a REIT has fallen below 1.8 times, the REIT manager should take steps and/or have plans in place to improve the REIT’s ICR and disclose this additional information. Details of the finalised positions and the Code amendments are set out in the response to the feedback received from the public consultation conducted between July and August 2024. Link to MASWebsite here ASIC Announces New Enforcement Priorities with a Focus on Cost of Living Pressures On 14 November 2024, the Australian Securities & Investments Commission (ASIC) announced its enforcement priorities for 2025, capturing the key areas where it will direct resources and expertise in the coming year. In 2025, ASIC says its enforcement priorities will focus on: • Misconduct exploiting superannuation savings; • Unscrupulous property investment schemes; • Failures by insurers to deal fairly and in good faith with customers; • Strengthening investigation and prosecution of insider trading; • Business models designed to avoid consumer credit protections; • Misconduct impacting small businesses and their creditors; • Debt management and collection misconduct; • Licensee failures to have adequate cyber-security protections;