MAS directs EH REIT to remove its manager
The management breached capital requirements three times.
The Monetary Authority of Singapore (MAS) has issued a notice of intention (NOI) to direct DBS Trustee Limited, the trustee of Eagle Hospitality REIT (EH REIT), to remove its current manager EH REIT Management and appoint a new manager.
This is in view of numerous breaches of the Securities and Futures Act (SFA) allegedly done by EH-REIT Mgt, and serious concerns over its ability to comply with rules and regulations, MAS said.
Since it was licensed in May 2019, EH-REIT Mgt has reportedly committed multiple breaches of the SFA, including breaches of the minimum base capital and financial resources requirements. The management first breached these requirements in Q4 2019 but only informed MAS of these breaches in April this year.
EH-REIT management again breached the same base capital requirement for a second and third time on 31 August and 30 September, respectively.
Apart from these, the management also failed to seek MAS’ approval for its provision of financial assistance to a subsidiary; submitted regulatory returns late; and failed to present to unitholders audited financial statements of EH-REIT within the stipulated timeframe.
“MAS has serious concerns about the EH-REIT Mgt’s ability and commitment to comply with MAS’ rules and regulations. MAS therefore deems it necessary to direct DBS Trustee Limitedto remove EH-REIT Mgt from managing EH-REIT and appoint a new manager,” the regulator said in the announcement.
MAS will announce its final decision after reviewing any written submissions from DBS Trustee Limited and EH-REIT management, which is given 10 business days to respond upon receipt of the NOI.