Singapore’s three listed banks, DBS, OCBC and UOB averaged a marginal gain yesterday amidst declines in the broader markets. This was on the back of a 4.0% average gain last week, in contrast to the Bloomberg Asia Pacific Banks Index gain of 3.4%.
Last week’s combined turnover of the three banks was more than double the preceding week. The average daily combined turnover of the three banks for last week was S$351 million, compared to S$132 million in the preceding week sessions.
The banks were the top three stocks that institutional investors bought for the week of 7 November. Together, institutional investors bought a combined value of S$425.7 million worth of stocks for the three banks.
Singapore’s three listed banks, DBS Group Holdings (DBS), Overseas-Chinese Banking Corporation (OCBC) and United Overseas Bank (UOB) started the week with a marginal average gain while the broader market was weaker with the Straits Times Index (STI) declining 1.0% and MSCI South East Asia Index declining 1.9%. The three banks were also amongst the top five most active stocks traded by value yesterday.
This follows on from last week’s performance when the trio averaged a total return of 4.0% over the five trading sessions amidst increased volatility. The three banks also marginally outperformed the Bloomberg Asia Pacific Banks Index, which gained 3.4% in SGD terms over the five sessions. DBS was the top performing bank stock last week, with a return of 8.0%, followed by UOB’s 2.3% and OCBC’s 1.8%. As noted yesterday (click here) this coincided with DBS traded almost three times its average weekly volume for the past three months.
The combined turnover of these three banks last week was at S$351 million, 165.9% higher than the S$132 million seen in the preceding five sessions. As illustrated below, in the two months preceding last week, there had been little trend in the share prices of the three banks. The letters on the charts correspond with corporate announcements which can be viewed on SGX StockFacts.
DBS Price & Volume in 2016 YTD
Source: SGX StockFacts
OCBC Price & Volume in 2016 YTD
Source: SGX StockFacts
UOB Price & Volume in 2016 YTD
Source: SGX StockFacts
The three banks were also the top three stocks that institutional investors bought for the week of 7 November. Together, institutional investors bought a combined value of S$425.7 million worth of stocks for the three banks. DBS, UOB and OCBC saw S$292.9 million, S$87.6 million and S$45.2 million worth of stocks being bought respectively. For monthly updates on Institutional flows, please click here.
As noted above, last week saw increased volatility in the global stock market. US bond yields continued to climb on the likelihood of inflation under President-elect Donald Trump's proposed fiscal policy. The increase in interest rate is seen as positive for the bank’s net interest margin. This is reflected in last week’s total return where the banks reacted and gained an average of 4.0%.
In the year to date thus far, the three bank stocks averaged a total return of 0.7%, this is marginally higher than the Bloomberg Asia Pacific Banks Index which is flat in Singapore Dollar total return terms. From a valuation standpoint, these three banks maintain an average ROE of 10.5% and trade at an average P/B ratio of 1.0x. Click on the stock name below to see the full stock profile in SGX StockFacts.
| Name | SGX Code | Last Price (S$) | Market Cap in S$M | Last Week’s Total Return % | Total Return YTD % | ROE | P/B* |
|---|---|---|---|---|---|---|---|
| DBS Group Holdings | D05 | 16.110 | 40926 | 8.0 | 0.4 | 10.4 | 0.9 |
| Oversea-Chinese Banking Corp | O39 | 8.610 | 35886 | 1.8 | 1.9 | 10.6 | 1.0 |
| United Overseas Bank | U11 | 18.850 | 30856 | 2.3 | -0.2 | 10.6 | 1.0 |
| Average | 4.0 | 0.7 | 10.5 | 1.0 |
Source: SGX, Bloomberg & SGX StockFacts (data as of 14 November 2016).
* P/B’s based on most recent financial reports
