Singapore banks ‘underweight’ amid fears of worsening asset quality

SINGAPORE (Oct 19): CIMB is keeping its “underweight” rating on Singapore banks amid worries over further worsening in asset quality, ahead of the local banks’ 3Q earnings announcements.

OCBC, UOB, and DBS are scheduled to report their quarterly earnings on Oct 27, Oct 28, and Oct 31, respectively.

CIMB analyst Jessalynn Chen says 3Q earnings are expected to fall between a “manageable” 2-5% q-o-q on the back of weaker net interest income (NII) and higher provisions as more oil & gas accounts turn into non-performing loans (NPL).

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