- July’s 3-month SORA was up 5bps m-o-m to 3.69% and 3-month HIBOR was up 26bps m-o-m to 5.10%.
- 2Q23 SG bank earnings were slightly above expectations. PATMI rose 35%, supported by NII growth of 37% y-o-y. Guidance for FY23e NIMs (from 2.05- 2.20% to 2.10-2.20%) and loans growth (maintained at low to mid-single digit). Interim dividend jumped 39% y-o-y in 1H23.
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- Maintain OVERWEIGHT. We remain positive on Singapore banks. Bank dividend yields are attractive at ~6.0% with upside surprise in dividends due to excess capital ratios and push towards higher ROEs. SGX is another major beneficiary of higher interest rates.
3M-SORA growth flattish; 3M-HIBOR rebounds in July
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- Hong Kong interest rates continued to surge and reversed the decline from 1Q23. The 3-month HIBOR was up 26bps m-o-m to 5.10%, the highest the 3-month HIBOR has reached since Dec 2022’s 3-month HIBOR of 5.29%. July’s 3-month HIBOR improved by 324bps y-o-y and was 82bps higher than 2Q23 3-month HIBOR average of 4.28%.
Singapore Banks' 2Q23 Results Highlights
Continued NII and NIM growth boost earnings
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