Singapore Commercial Banking Industry Update Quarter 2 2012

  • March 2014
  • -
  • Business Monitor International
  • -
  • 74 pages

Includes 3 FREE quarterly updates

Since Q108, we have described numerically the banking business environment for each of the countries
surveyed by BMI. We do this through our Commercial Banking Business Environment Rating (CBBER),
a measure that ensures we capture the latest quantitative information available. It also ensures consistency
across all countries and between the inputs to the CBBER and the Insurance Business Environment
Rating, which is likewise now a feature of our insurance reports. Like the Business Environment Ratings
calculated by BMI for all the other markets on which it reports, the CBBER takes into account the
limits of potential returns and the risks to the realisation of those returns. It is weighted 70% to the former
and 30% to the latter.

The evaluation of the 'Limits of potential returns' includes industry elements that are specific to the
banking market of the country in question and elements that relate to that country in general. Within the
70% of the CBBER that takes into account the 'Limits of potential returns', the industry elements have a
60% weighting and the country elements have a 40% weighting. The evaluation of the 'Risks to
realisation of returns' also includes banking elements and country elements (specifically, BMI's
assessment of long-term country risk). However, within the 30% of the CBBER that take into account the
risks, these elements are weighted 40% and 60%, respectively.

Further details on how we calculate the CBBER are provided at the end of this report. In general, though,
three aspects need to be borne in mind in interpreting the CBBERs. The first is that the industry elements
of the 'Limits of potential returns' are by far the most heavily weighted of the four elements. They account
for 60% of 70% (or 42%) of the overall CBBER. Second, if the industry elements are significantly higher
than the country elements of the 'Limits of potential returns', it usually implies that the banking segment is
(very) large and/or developed relative to the general wealth, stability and financial infrastructure in the
country. Conversely, if the industry elements are significantly lower than the country elements, it usually
means that the banking segment is small and/or underdeveloped relative to the general wealth, stability and
financial infrastructure in the country. Third, within the 'Risks to the realisation of returns' category, the
market elements (i.e. how regulations affect the development of the segment, how regulations affect
competition within it, and Moody's Investor Services' ratings for local currency deposits) can be markedly
different from BMI's long-term risk rating.

Table Of Contents

Executive Summary ..... 5
Data : Levels (SGDbn) 5
Data : Levels (US$bn) . 5
Data : Levels At January 2012 5
Data : Annual Growth Rate Projections from 2012 to 2016 (%) ... 5
Data : Ranking Out Of 59 Countries Reviewed In 2011 .... 6
Data : Projected Levels (SGDbn) .. 6
Data : Projected Levels (US$bn) ... 6
Industry SWOT Analysis . 7
Singapore Commercial Banking SWOT ..... 7
Singapore Political Environment and Risk Analysis . 7
Singapore Economic Environment and Risk Analysis ..... 8
Singapore Business Environment SWOT ... 9

Environment Overview Outlook .. 10
Commercial Banking Business Environment Rating .. 10
Data : Commercial Banking Business Environment Ratings . 10
Commercial Banking Business Environment Rating Methodology .... 11
Data : Asia Commercial Banking Business Environment Ratings ..... 12
World Commercial Banking Outlook ..... 13
Asia Banking Segment Outlook 17
Three Threats To Asia's Banks In 2012 .... 17
Asia Banking Segment Projection Overview .. 22
Data : Banks' Bond Portfolios ..... 22
Data : Asia Commercial Banking Business Environment Ratings ..... 23
Data : Comparison of Loan/Deposit and Loan/Asset and Loan/GDP ratios . 24
Data : Anticipated Developments in 2012 ..... 25
Data : Comparison of Total Assets and Client Loans and Client Deposits (US$bn) . 26
Data : Comparison of USD Per Capita Deposits (2011) .. 27
Data : Interbank Rates and Bond Yields .. 28
Singapore Banking Segment Outlook .. 29
Loan Growth Seen Hampering Profits In 2012 .... 29
Economic Outlook 34
Data : Singapore - Economic Activity ..... 36

Competition Overview ... 37
Market Structure . 37
Protagonists ... 37
Data : Protagonists In Singapore's Commercial Banking Segment 37
Definition Of The Commercial Banking Universe 37
List Of Banks . 38
Data : Licensed Commercial Banks In Singapore ..... 38
Company Profiles . 42
Bangkok Bank 42
Data : Key Statistics For Bangkok Bank, from 2006 to 2008 (THBmn) ... 43
Hong Leong Bank 44
Data : Key Statistics For Hong Leong Bank, from 2007 to 2009 (MYRmn) ... 45
Maybank .. 46
Data : Key Statistics For Maybank, from 2007 to 2009 (MYRmn) ..... 47
Islamic Bank of Asia .. 48
Bank of China 49
DBS Bank. 51
Singapore Stock Industry Indicators .... 52
Singapore Balance Sheet (LCYmn) .... 53
Singapore Balance Sheet (US$mn) .... 53
Singapore Key Ratios (%) 53
Oversea-Chinese Banking Corporation ... 54
Data : Stock Industry Indicators, from 2004 to 2009 ... 55
Data : Balance Sheet (SGDmn, unless stated), from 2004 to 2009 .... 55
Data : Balance Sheet (US$mn, unless stated), from 2004 to 2009 ..... 56
Data : Key Ratios (%), from 2004 to 2009 ..... 56
United Overseas Bank ..... 57
Data : Singapore Stock Industry Indicators..... 58
Data : Singapore Balance Sheet (LCYmn) ..... 58
Data : Singapore Balance Sheet (US$mn) ..... 59
Data : Singapore Key Ratios (%) 59
Citibank Singapore .... 60
BMI Banking Segment Methodology .... 62
Commercial Bank Business Environment Rating . 63
Data : Commercial Banking Business Environment Indicators And Rationale.... 64
Data : Weighting Of Indicators ... 65

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