- July’s 3-month SORA was down 3bps m-o-m to 3.64% and 2bps lower than the 2Q24 average. 3-month SORA has been hovering around the 3.6% range since Jan 2024. 3-month HIBOR was down 6bps m-o-m in July to 4.69%, a slight reversal from the increase of 8bps in June.
- 2Q24 bank earnings were slightly above expectations. PATMI rose 6% y-o-y, supported by fee income growth of 18% y-o-y, while NII growth moderated to 2%. FY24e guidance is for NII to remain stable y-o-y with NIMs at the current levels of around 2-2.25% and loan growth of low-single digit. Fee income is expected to sustain earnings with the expectation of double-digit growth for FY24e.
3-month SORA and 3-month HIBOR dip slightly
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Singapore loan growth positive in June 2024
- Overall loans to Singapore residents – which captured lending in all currencies to residents in Singapore – rose by 0.5% y-o-y in June to S$804bn. This increase more than reversed the decline of 0.3% from the previous month. We expect low-single-digit growth for 2024 as loan growth is expected to recover further from the expected rate cuts going into 2H24, which will spur spending by both businesses and consumers across all segments.
- Business loans fell by 0.1% y-o-y in June. Loans to the building and construction segment, the single largest business segment, dipped 1.4% y-o-y at S$169bn, while loans to the manufacturing segment fell 10% y-o-y in June to S$21bn.
- Consumer loans grew 1.6% y-o-y in June to S$315bn, the sixth consecutive y-o-y increase recorded since December 2023. Housing loans, which comprise ~70% of consumer lending, grew 1.4% y-o-y in June to S$226bn.
- Total deposits and balances—which include deposits in all currencies made by non-bank customers—grew by 6% y-o-y in June to S$1,853bn. In the Current Account and Savings Account, or CASA, the proportion rose slightly to 18.3% (May24: 18.1%) of total deposits or S$339bn. Notably, the CASA proportion has been ranging between 18.1%-18.3% since Jan 2024.
Hong Kong loan growth decline continues
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Above is the excerpt from report by Phillip Securities Research.
Clients of Phillip Capital may be the first to access the full report in PDF @ https://www.stocksbnb.com/.
Glenn Thum Phillip Securities Research | http://www.poems.com.sg/ 2024-08-19
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)
