Brexit: UOB suspends London property loans

View of mansion blocks in London. United Overseas Bank (UOB) has suspended its loan programme for London properties after Brexit pushed the pound to a 30-year low and spooked global markets, reported Reuters.
Singapore’s third biggest lender is the first bank here to turn cautious on London property loans, even though it is not a big amount.
“We will temporarily stop receiving foreign property loan applications for London properties,” said a UOB spokeswoman.
“As the aftermath of the UK referendum is still unfolding, and given the uncertainties, we need to ensure our customers are cautious with their London property investments.”
Meanwhile, DBS Bank, Singapore’s biggest lender, revealed it is still offering financing for London property purchases. However, it is advising its customers to remain cautious.
“For customers interested in buying properties in London, we would advise them to assess the situation carefully before committing to their purchases as there could be potential foreign exchange and sovereign risks,” said Tok Geok Peng, Executive Director of Secured Lending, Consumer Banking Group (Singapore) at DBS Bank.
Since the referendum, the Singapore dollar has gained 10 percent against the British pound.
“There have been London properties available for the last few months before the Brexit. The question is whether these properties can still continue to receive buyers in the short-term,” said Alice Tan, Research Head at Knight Frank Singapore.
Property consultants noted that data on the number of properties purchased by Singaporeans in the UK is not closely tracked, while banks do not disclose lending data for property purchases in the UK.
UOB said it is closely monitoring the situation and would regularly review it to determine when it could resume its loan programme for London properties.
According to UOB’s website, the bank runs an international property loans programme which also covers properties in Malaysia, Thailand, Australia and Japan.
Romesh Navaratnarajah, Senior Editor at PropertyGuru, edited this story. To contact him about this or other stories, email romesh@propertyguru.com.sg

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