Singapore among weakest in Morgan Stanley's Asia ex-Japan debt scorecard

SINGAPORE (Sept 20): Companies in Asia excluding Japan have been taking on increasing debt, a study by Morgan Stanley found. While Taiwan, Korea, Indonesia, and India have the most favourable debt scores, Singapore, China, Malaysia, and Thailand have the weakest.

But as gross leverage continues to rise, policymakers are aiming for a gradual adjustment and companies are taking steps to improve their balance sheets, says lead analyst Pankaj Mataney.

In 1H16, gross debt to gross domestic product (GDP) has continued to rise from 147% in 2007 to 221%, with China, Hong Kong and Thailand seeing the highest rise, while Singapore has seen debt to GDP decline, which suggests progress in deleveraging. Likewise among listed companies in the MSCI Asia ex-Japan index, gross leverage (total debt to EBITDA) has increased from 184% in 2007 to 302% in 1H16.

---

Related Stories

• Can SGX afford to wait up to a year for reforms?
• HSBC sees ‘unattractive’ risk reward for Goldman Sachs, Morgan Stanley
• Morgan Stanley joins US peers in putting Mideast HQ in Riyadh

---