Stress tests by the MAS have revealed that most households should be able to service their mortgage debt even under conservative scenarios of significant income losses.
Mr Tan clarified that the number of bankruptcy orders in the first half of 2024 has been “stable” compared with the same period in previous years, despite Stress tests by the MAS have revealed that most households in Singapore should be able to service their mortgage debt even under conservative scenarios of significant income losses or elevated interest rates of 5.5 per cent.
To mitigate the risks of over-indebtedness, the MAS requires financial institutions to implement certain “safeguards”, Mr Tan said, adding that it is important to ensure that Singaporeans borrow prudently.