Singapore said Tuesday it will ban from its ports and naval bases an Indonesian navy ship named after two marines who bombed an office complex in the city-state during a period of tense relations in the 1960s.

Defence Minister Ng Eng Hen said the ship will be barred in an ongoing dispute over the Indonesian navy's decision to name a refurbished frigate after the two marines, Usman Haji Mohamed Ali and Harun Said, who were convicted and executed in Singapore for the bombing of the downtown MacDonald House in March 1965.

The attack killed three people and injured 33 others.

It was part of an effort by then Indonesian president Sukarno to stage an armed confrontation against the newly formed federation of Malaysia, which included Singapore.

"Singapore will not allow this military ship named Usman Harun to call at our ports and naval bases," Ng said in parliament Tuesday.

"It will not be possible for the SAF (Singapore Armed Forces) as protectors of this nation to sail alongside or exercise with this ship."

In an emotionally charged speech, Ng said the defence ministry and the SAF were "disappointed and dismayed at this inexplicable move".

"Even without ill intent, how can the naming of the ship after two bombers build good ties or enhance mutual respect and regard with both our countries," he said.

Responding to the ban, Indonesian security minister Djoko Suyanto said: "The ship has not even arrived yet, so what's the fuss?"

"Anyway, who says the ship will be taken to Singapore?" he told AFP by text message.

The two marines involved in the 1965 attack were members of Indonesia's special Operations Corps Command, now the Marine Corps, who had been ordered to infiltrate Singapore.

Singapore's Ng said the Indonesian vessel's presence in the high seas would be a "constant reminder of the military aggression and atrocious crimes committed by the Indonesian marines who killed or irreparably damaged the lives of innocent civilians and their families in Singapore".

He added however that Singapore would not "overread and jump at shadows" over Indonesia's move, and would look to rebuild good bilateral military ties with its larger neighbour.

In a separate statement also in parliament, Singaporean Foreign Minister K. Shanmugam said the city-state had sent Jakarta a formal protest note over the issue.

He said Singapore would take Indonesian Foreign Minister Marty Natalegawa at his word "that there was no ill-will and there was no malice and that it (the naming of the ship) was a decision taken at a professional level".

Singapore, which acrimoniously split from Malaysia to become an independent state in 1965, and Indonesia are key members of the Association of Southeast Asian Nations (ASEAN).

Indonesia is Singapore's third largest trading partner, with total bilateral trade reaching Sg$79.4 billion ($62.6 billion) in 2012.

Relations between the two countries hit a low point in the late 1990s after the fall of former dictator Suharto, and his successor B.J. Habibie famously referred to the tiny city-state as a "little red dot" on the map.

Ties have improved considerably in recent years under the stewardship of current Singapore Prime Minister Lee Hsien Loong and Indonesian President Susilo Bambang Yudhoyono.