Single-digit loan growth looms over Singapore banks in 2013

November 2012 saw growth stalling to 15.9%.

According to UOB, loan growth moderated as economic growth slowed in 2H12. Loan growth averaged 24.9% in 1H12 but decelerated to 15.9% in Nov 12.

The slowdown was mainly driven by loans to businesses, which moderated from the average expansion of 31.6% in 1H12 to 15.3% in Nov 12. From an industry
perspective, the slowdown was driven by general commerce, transport & storage, and non-bank financial institutions & holding companies.

Here's more from UOB:

We forecast the banking industry to register high single-digit loan growth of 8-10% for 2013. We expect growth to be evenly balanced between loans to businesses and consumers.

The slowdown in loans to businesses could be near a bottom. We estimate growth in loans to consumers to be sustained due to continued drawdown for private residential properties already sold and newly-completed HDB flats.

Singapore banks have taken a conservative approach to strengthening their balance sheets given the turmoil in Europe. They have boosted their core equity tier-1 capital adequacy ratio (CET-1 CAR) through retained earnings.

In addition, OCBC also got a boost from divesting its holdings of F&N and APB shares in 3Q12. NPL ratios have remained relatively unchanged despite external turbulence while loan loss coverage ratios are significantly above 100%. We expect subdued credit cost to be maintained in 2013.

For more banking stories, visit Asian Banking & Finance.



More From Singapore Business Review
 
Recent Quotes
Symbol Price Change % Chg 
Your most recently viewed tickers will automatically show up here if you type a ticker in the "Enter symbol/company" at the bottom of this module.
You need to enable your browser cookies to view your most recent quotes.
 
Sign-in to view quotes in your portfolios.

Market Data

  • Currencies
    Currencies
    NamePriceChange% Chg
    1.2581+0.0027+0.22%
    USDSGD=X
    1.7404+0.0057+0.33%
    EURSGD=X
    2.1141+0.0075+0.36%
    GBPSGD=X
    81.3075-0.3664-0.45%
    SGDJPY=X
    6.1625-0.0131-0.21%
    SGDHKD=X
    2.5983-0.0029-0.11%
    SGDMYR=X
    9,247.7109-51.9736-0.56%
    SGDIDR=X
    4.9674-0.0013-0.03%
    SGDCNY=X
    1.1654-0.0005-0.04%
    AUDSGD=X
  • Commodities
    Commodities
    NamePriceChange% Chg
    1,293.70+9.10+0.71%
    GCM14.CMX
    19.64+0.20+1.04%
    SIK14.CMX
    91.62-1.25-1.35%
    ^XAU
    3.12+0.06+1.85%
    HGK14.CMX
    101.89+0.45+0.44%
    CLM14.NYM
  • Bonds
    Bonds
    TreasuryYield (%)Yield Change
    1.74+0.03
    ^FVX
    2.690.00
    ^TNX
    3.460.00
    ^TYX

MARKET MOVERS

  • Most Actives
    Most Actives
    NamePriceChange% Chg
    0.123+0.001+0.82%
    B22.SI
    0.15+0.008+5.63%
    545.SI
    0.635+0.040+6.72%
    5WH.SI
    0.615+0.005+0.82%
    E5H.SI
    1.355+0.005+0.37%
    G13.SI
  • % Gainers
    % Gainers
    NamePriceChange% Chg
    20.00+4.200+26.58%
    K6S.SI
    1.215+0.190+18.54%
    S53.SI
    0.415+0.045+12.16%
    570.SI
    1.345+0.130+10.70%
    5DA.SI
    0.154+0.014+10.00%
    5GD.SI
  • % Losers
    % Losers
    NamePriceChange% Chg
    0.053-0.059-52.68%
    5TF.SI
    1.62-0.520-24.30%
    N02.SI
    0.20-0.020-9.09%
    E94.SI
    0.179-0.013-6.77%
    567.SI
    0.30-0.020-6.25%
    508.SI