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Singapore Banking Industry Report - H1, 2013

October 2013 | 33 pages | ID: S3DF87FD7B7EN
Emerging Markets Direct

US$ 475.00

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This report surveys the banking and finance sector in Singapore, with analysis of market trends through H1 2013 and outlook for the sector in the short and medium term. It also provides financial information for leading players including DBS, Overseas-Chinese Banking Corporation, and United Overseas Bank Limited.

Singapore’s economy returned to higher growth in the second quarter of 2013 backed by an increase in exports. Both domestic banking units and the Asian currency units showed double-digit loan growth due to revival of positive sentiments in the country. Loans for purchase of residential property dominated the portfolio of most of the domestic banking units, with the country’s low interest rates and growing population driving loan growth in the segment. Fixed deposits and savings deposits continued to dominate the bank’s total deposits; more than three-quarters of the deposits were in these two segments. Tax rebates and lower risk drove customers to these segments. The banking system remained stable with ample liquidity to meet demand for deposit withdrawals and other liquidity obligations. The central bank’s overnight policy rate has remained stable for a while. The Monetary Authority of Singapore has kept the lending rates low in order to drive domestic consumption in the country as well as help small and medium enterprises.

The profitability of companies in the sector has taken a hit because of the rising costs of operation. The net interest margin has dipped across banks. Most banks are promoting fee-based products and services to enhance their profitability. The net non-performing loans ratio picked up slightly during the first half of the year. The outlook for the Singaporean banking and financial services sector is stable owing to the strong financials of companies and stable economic environment in the country. The country’s rating as a top-ranked international financial center bodes well for the growth of this sector.

Key Points:
  • This report discusses the market position and financial information for leading players in the sector including DBS Group Holdings Limited (DBS), Overseas-Chinese Banking Corporation Limited (OCBC), and United Overseas Bank Limited (UOB). It also includes a comparative matrix of important data for each of these firms.
  • The asset base of domestic banking units (DBUs) in Singapore grew at a CAGR of 10.8% during 2003–12. The total assets of the system increased by 4.8% y/y in August 2013.
  • The asset base of Asian Currency Units (ACUs) grew at a CAGR of 8.8% during 2003–12. The total assets of the banking system increased by 4.3% y/y in August 2013.
  • Total loans and advances of domestic banking units grew by 14.7% y/y to SGD 475bn in August 2013, outperforming its long-term growth trend of 10.9%. Total non-banking customer deposits of domestic banking units grew by 6.4% y/y to SGD 538bn in August 2013, which was much lower than the long-term average growth rate of 11%.
  • After witnessing a recession in Q3FY12, the finance and insurance sector emerged as the fastest-growing sector of the economy in Q2FY13, recording a y/y growth of 13.1%.
1. INDUSTRY PROFILE

1.1 Sector overview
1.2 Sector size
  1.2.1 Assets
  1.2.2 Liabilities
1.3 Environmental scanning

2. MARKET TRENDS AND OUTLOOK

2.1 Key economic indicators-Singapore
2.2 Interest rates
2.3 Statutory liquidity position of banks
2.4 Capital adequacy
2.5 Classified exposure
2.6 Profitability

3. LEADING PLAYERS AND COMPARATIVE MATRIX

3.1 Leading players
  3.1.1 DBS Group Holdings Limited (DBS)
  3.1.2 Overseas-Chinese Banking Corporation Limited (OCBC)
  3.1.3 United Overseas Bank Limited (UOB)
3.2 Comparative matrix
3.3 SWOT analysis

4. TABLES & CHARTS

Table 1: Types of financial institutions in Singapore
Table 2: Functions of Monetary Authority of Singapore
Table 2: Interest rates in Singapore
Table 4: Capital adequacy requirements prescribed by MAS
Table 5: Key ratios of the leading players
Chart 1: Office network of Singaporean banking institutions
Chart 2: Number of Banking and Financial Institutions in Singapore
Chart 3: Market Share of financial institutions in terms of asset size
Chart 4: Asset share by type of bank
Chart 5: Total assets of domestic banking units
Chart 6: Asset profile of domestic banking units of Singapore
Chart 7: Total assets of Asian currency units
Chart 8: Asset profile of Asian currency units of Singapore
Chart 9: Total loans and advances of DBUs
Chart 10: Distribution of loans approved by purpose-DBUs
Chart 11: Total loans and advances of ACUs
Chart 12: Distribution of loans approved by purpose-ACUs
Chart 13: Liability profile of domestic banking units of Singapore
Chart 14: Total deposits of non-banking customers-DBUs
Chart 15: Liability profile of ACUs
Chart 16: Total interbank funds of ACUs
Chart 17: Constituent parties in parliament
Chart 18: Cost of business start-up procedures
Chart 19: Total assets of Monetary Authority of Singapore
Chart 20: Asset and liability profile of Monetary Authority of Singapore
Chart 21: Singapore quarterly GDP growth rate
Chart 22: Quarterly exports from Singapore
Chart 23: Current account balance of Singapore
Chart 24: Annual fiscal balance of Singapore
Chart 25: Average monthly USD to SGD exchange rate
Chart 26: Inflation during FY13-Singapore
Chart 27: GDP by sectors at 2005 prices
Chart 28: Percentage change over previous year- GDP by Sector
Chart 29: Overnight policy rate (SGS Repo) in Singapore
Chart 30: Liquidity ratio of banks in Singapore
Chart 31: Exposure of Singaporean banking industry
Chart 32: Net classified exposure ratio
Chart 33: Return on assets ratios
Chart 34: Cost to income ratios
Chart 35: Asset profile of DBS-Annual
Chart 36: Profitability of DBS-Annual
Chart 37: Non-performing loans of DBS
Chart 38: Asset profile of OCBC-Annual
Chart 39: Profitability of OCBC-Annual
Chart 40: Non-performing loans of OCBC
Chart 41: Asset profile of UOB-Annual
Chart 42: Profitability of UOB-Annual
Chart 43: Non-performing loans of UOB


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