Singapore Banks - OCBC Investment 2023-12-18: To Exit Or Double Down? Are Singapore Banks Too Expensive?

Singapore Banks - To Exit Or Double Down? Are Singapore Banks Too Expensive?

Singapore Banks - DBS OCBC UOB | SGinvestors.ioDBS (SGX:D05) UNITED OVERSEAS BANK LTD (SGX:U11)
  • In 2023, banking shares were largely able to hold their grounds, but share prices have taken a hit recently. This is based on the FTSE ST All-Share Financials Index (FSTFN), which fell from 1162.07 on 15 Sep 2023 to a recent low of 1079.17 on 7 Dec 2023, or a decline of 7.1% in the past three months.
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  • Is this an early sign to reduce holdings ahead of slowing macroeconomic growth and challenging conditions in 2024 or is it time to increase holdings as share prices tend to reflect known uncertainties?

Are Singapore banks too expensive?

  • From the pandemic lows in March 2020 till now, Singapore banking stocks have recovered almost 70% on average – a credible performance over a period of less than four years. This could possibly explain why banking stocks are at times deemed to be too expensive versus the Straits Timex Index, which recovered 39% from the pandemic low to current level or when compared to the MSCI Singapore Index which rose only 8% over the same period.
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  • Our base case is for a mild recession in 2024 and that interest rates will start to ease off.

What about valuations? Are these too rich?

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Above is the excerpt from report by OCBC Investment Research.
Clients of OCBC Securities may be the first to access the full report in PDF @

Carmen Lee OCBC Investment Research | 2023-12-18

More reports on banking & finance sector:
Analyst Reports on Singapore Banking & Finance Sector

Read also:
Analyst Reports on DBS Group
Analyst Reports on OCBC Bank
Analyst Reports on United Overseas Bank (UOB)


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