- April’s 3-month SORA was down 15bps m-o-m to 2.47%, the lowest since Oct 2022 and 33bps lower than the 1Q25 average, reflecting the Fed Rate cuts. Singapore loans growth holding at mid-single digit (Mar24: 4.8%), but we might see a slight slowdown due to the trade war.
- 1Q25 bank earnings were within expectations. The banks are guiding to increase allowance coverage due to macroeconomic uncertainty, and we expect FY25e PATMI to be flat y-o-y, as excess earnings will be placed into GP overlays.
3-month SORA is at its lowest since Oct 2022.
- Singapore's interest rates fell 15bps m-o-m to 2.47% in April, the lowest since October 2022. Furthermore, April’s 3-month SORA fell by 118bps y-o-y and was 33bps lower than the 1Q25 3-month SORA average of 2.80% (4Q24: 3.29%). This is the most significant y-o-y decline since November 2020. We expect the 3-month SORA to continue declining as more Fed rate cuts are expected.
Highlights of Singapore banks' 1Q25 earnings.
Fees continue to support earnings.
This is a partial preview of the article. The complete article, including further analyst commentary on the outlook, valuation, dividend forecast, stock rating, target price, and more, is available on SGinvestors.io.
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Glenn Thum Phillip Securities Research | https://www.poems.com.sg/ 2025-05-16
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