In the current rising interest rate environment, all eyes are on banks as they are expected to experience a boost in performance. However, not all banks are created equal and their performance would vary. Before they post their 2Q18 results, here is a roundup of their expected performance! Operating Environment Overall, the economic conditions remain favourable for the banking sector with rising interest rates and a benign credit environment. Looking forward, the cutting down of manpower through digitalisation should help to increase efficiency and improve performance. Singapore’s economic growth stood at 4.3 percent year on year for the first quarter of the year due to growth in the manufacturing and service sector. With the economy picking up, the Monetary Authority of Singapore has sh

There are many ways to find investment ideas. Some useful ways are to screen for stocks or to look at a list of stocks near their 52-week lows to sieve out potential bargains. Studying what institutional investors have been buying or selling is another avenue. Institutional investors are typically large investment organisations, such as hedge funds, mutual funds, unit trust companies, sovereign wealth funds, insurance companies and so on. These investors tend to possess vastly greater resources than individual investors like you and me when researching stocks. Hence, it may be useful to keep a close eye on what they are doing, as a way to generate ideas. In this article, I will look at three Singapore stocks that have seen the highest net purchases in dollar value by institutional investor

Net-net investing is a value-investing technique popularised by the father of value investing Benjamin Graham – the mentor to Warren Buffett. The approach values a company based on how much investors could receive immediately assuming that the company is liquidated, by taking current assets net of total liabilities without taking into consideration the worth of its long-term assets. In fact, it is not absurd to think that some investors might actually prefer that the company be liquidated so that its intrinsic value could be realised. The irony is that if net-net stocks are indeed so undervalued, then why are they trading at such attractive prices? The problem with net-net stocks is that although they might be rich in terms of asset value, their profitability are often not that spectacul

Warren Buffett is a huge advocate of businesses buying back their shares. He believes that share buybacks can reveal a thing or two about the company’s management. He once opined: “What you’d like to do as an investor is hook them up to a machine and run a polygraph to see whether it’s true. Short of a polygraph the best sign of a shareholder-oriented management — assuming its stock is undervalued — is repurchases. A polygraph proxy, that’s what it is.” On that note, let’s check out three companies picked at random that have repurchased their shares thus far during the week, as of market open today. United Overseas Bank Ltd (SGX: U11) With more than 500 branches in 19 countries, United Overseas Bank, more commonly known as UOB, is one of the

2017 was a good year for banks. Improvements in the oil and gas sector, higher interest rates, and an improving market for housing loans were all drivers of growth. Consequently, United Overseas Bank Ltd (SGX: U11) benefitted from the positive economic tailwinds to post a 9% increase in net profit after tax in 2017. But, there are in fact many more positives about UOB’s business performance in 2017 that shareholders of the bank should be pleased about. Fee and commission income up 12% UOB breaks down its income into three components: Net interest income; fee and commission income; and other non-interest income. Net interest income essentially comes from the interest earned from the loans that UOB makes, while fee and commission income is earned from the variety of services the bank pro

Chief Executive Officers (CEOs) are the people that run companies, make critical operational decisions that impact everything from employee morale to balance sheet health to futures business direction. This job usually comes with immense pressure to perform and long-hours to get the work done. Obviously, this job is not for the faint-hearted. This also often means that they are the most handsomely paid employee in the company. In this article, we look at how much the biggest listed companies in Singapore, those on the Straits Times Index (STI), paid their CEOs in FY2017. CEO Salary In FY2017 Three companies did not divulge the remuneration of their chief executive – Jardine Matheson Holdings; Jardine Strategic Holdings; and Hongkong Land. Also Read: How Much Money Do You Actually Take

Singapore has been aggressively pursuing a vision to grow into a global insurance marketplace by 2020, when Asia is expected to account for almost 40% of the global insurance market. Singapore is already recognised as Asia’s leading reinsurance hub, with 16 of 25 of the world’s reinsurers having regional hubs here. The Monetary Authority of Singapore continues to drive initiatives to grow the alternative risk transfer mechanisms like insurance-linked securities (ILS) and help build up expertise in specialty insurance, such as for marine, energy, credit and political risks. On the consumer side, the Life Insurance Association reported that the life insurance industry in Singapore achieved a record $4.088 billion in total weighted new business premiums for 2017. Private insurance bou

Singapore banks are often touted as some of the safest and best banks in the world, coming in at 11th (DBS), 13th (OCBC) and 14th (UOB) in the World’s Top 50 Safest Banks by Global Finance. In Singapore, they comprise close to 42% of the benchmark Straits Times Index (STI). Everyone in Singapore is also very familiar with these three banks, with accounts in at least one, if not all, of them. This makes local banks a safe place for new investors to start learning the ropes of stock investing. Singapore Banks – DBS; OCBC; UOB Backed by a healthy global economy and rising interest rates, banks generally had a good year in FY2017. In particular, the three local banks rose by an average of 37% in 2017. In 2018, they have already gained an average of close to 6%. On 20 March 2018, Maybank Ki

When times are good, banks can make money – lots of it. But when times are bad, banks can get hit. That’s just the way things go. It’s not that bankers never learn from their past mistakes. It’s because they lend aggressively when the economy is booming. But they can get caught out, when the economy dips. Thing is, when times are looking good, central bankers like to crank up their lending rates. It’s quite simple – in a strong economy, where wages are rising, then consumer prices could rise too. But central bankers want to be ahead of inflation. So, they try to ensure that their interest rates stay above the pace of rising prices. Up and down So, interest rates can both go up and go down. Whether we are savers, borrowers, home owners or retirees, interest rate movements af

Today, we are going to share with you how to grow your CPF investment money in a no-brainer way. The best part? You need not be financial savvy to do this. A beginner can do it! And I’ll reveal the exact step-by-step process, which you can follow easily. What is CPF Investment Scheme (CPFIS)? It is to provide option to CPF members to invest their CPF savings in various instruments such as insurance products, unit trusts, fixed deposits, bonds and shares. The Average CPF Interest Rate is 2.5% to 4% for Ordinary Account. Check their latest interest rate here. Below is the latest CPF rate. Share this Infographic On Your Site </p><br /><br /><br /><br /><br /><br /><br /><br /><br /><br /><br /><br /><br />

Warren Buffett is someone who actively encourages companies to buy back their shares if the conditions are right. He once said that when the shares of outstanding companies with strong financial positions are selling below their intrinsic value, no other action can benefit shareholders as share repurchases can. On that note, let’s look at three Straits Times Index (SGX: ^STI) components picked at random that have repurchased their shares during the week (as of 16 March 2018, 11:30 am). CapitaLand Limited (SGX: C31) CapitaLand is one of Asia’s largest real estate firms with a global portfolio of assets such as integrated developments, shopping malls, and offices. On 12, 13, 14 and 15 March 2018, the property outfit bought back a total of 4,101,400 shares at a price range of between S$

Share buyback consideration in the month of February rose to a 20 month high with $134.2 million in buybacks, with 26.4 million shares repurchased by 17 stocks. The STI declined 0.4% over the month, which coincided with earnings season. The 17 stocks included as many as eight STI constituents – CapitaLand, Keppel Corporation, Oversea-Chinese Banking Corporation, United Overseas Bank, Singapore Exchange, SATS, Sembcorp Industries and Singtel. These eight stocks made up as much as $131.1 million of the consideration. CapitaLand reported FY17 results on 13 Feb. The company commenced its share buyback mandate the following week, topping the February tally with buyback consideration of $43.8 million. The mandate to buyback 2% of issued shares had been approved back in April 2017. To

The three listed banks in Singapore are DBS Group Holdings Ltd (SGX: D05), Oversea-Chinese Banking Corporation Limited (SGX: O39) and United Overseas Bank Ltd (SGX: U11). Year-to-date, shares of the trio have outperformed the Straits Times Index (SGX: ^STI). For instance, DBS’ shares have risen more than 11% since the start of 2018 to end last Friday at S$28.41. Given the strong lead up thus far, I thought it would be interesting to see which bank is still valued lower than the SPDR STI ETF (SGX: ES3), an exchange-traded fund which can be taken as a proxy for the Straits Times Index. The table below shows the comparison of the banks against the SPDR STI ETF (the best values among the banks are in bold): Source: Author’s calculations using the banks’ 2017 financial statements; pri

In the year to-date, the Straits Times Index (STI) has increased by 1.4%. This is marginally better than how many major global country indexes have performed – Hong Kong’s Hang Seng Index (HSI) has increased 0.2%; London’s Financial Times Stock Exchange 100 (FTSE 100) decreased 7.6%; and USA’s Standard & Poor’s 500 (S&P 500) has increased 0.7%. Also, this comes on the back of heightened volatility in equity markets, with many correcting by has high as over 10% in early February before recovering later in the month. This may have offered companies a chance to act on their share buyback mandates, to purchase outstanding shares on the open market. In February, managers of 17 companies spent close to $134.2 million buying back 26.4 million shares from the market. This is the

Warren Buffett is someone who strongly encourages companies to buy back their shares if the conditions are right. In his 1984 Letter to Shareholders, he said: “When companies with outstanding businesses and comfortable financial positions find their shares selling far below intrinsic value in the marketplace, no alternative action can benefit shareholders as surely as repurchases.” On that note, let’s look at three Straits Times Index (SGX: ^STI) components picked at random that have repurchased their shares thus far during the week. CapitaLand Limited (SGX: C31) CapitaLand is one of Asia’s largest real estate firms with a global portfolio of assets such as integrated developments, shopping malls, and offices. On 26, 27 and 28 February, and 1 March 2018, the company bought ba

The trio of banks in Singapore – DBS Group Holdings Ltd (SGX: D05), Oversea-Chinese Banking Corporation Limited (SGX: O39) and United Overseas Bank Ltd (SGX: U11) – make up slightly more than 40% of the Straits Times Index (SGX: ^STI). With such high contributions to Singapore’s stock market benchmark, the banks draw a huge interest from the investing public. With the three financial giants all having reported their 2017 full year earnings recently, I thought it would be interesting to do a comparison of their latest financial performance to determine which is the best performer. Key ratios on profitability The table below shows a few key ratios that give us a picture of the banks’ profitability: Source: Banks’ 2017 financial statements (the “best” metrics are in bold

Here are some of the most interesting articles that have appeared on the Motley Fool Singapore’s website this week. Singapore Budget 2018 Singapore Budget 2018 was unveiled on 19 February. For our coverage of the budget and the listed companies that could benefit, you can check out the links below: a) Three Announcements in the Singapore Budget That Will Affect Investors – click here b) Singapore Budget 2018: The Singapore-Listed Companies That Could Benefit (Or Be Harmed) – click here c) Singapore Budget 2018: These Singapore-Listed Entities Could Benefit (And a Bonus Tip) – click here 3 Things You Should Know When Investing In REITs When we invest in properties, we usually compare the prices of properties around the same area to see if we are getting a good deal.

DBS, OCBC & UOB have now all reported FY17 results, with the latter two reporting before the 14 February open. The three banks are amongst the region’s biggest stocks by market capitalisation and account for 38% of the STI’s weight. The three banks averaged 27% YoY Net Profit Growth for 4Q17, bringing their combined FY17 net profit to $11.9 billion. On average, net interest income contributed 61% to the banks FY17 total income, ranging from 56% for OCBC to 65% for DBS. The banks share prices have also recently performed comparatively strongly. The three listed bank stocks have averaged a 4.7% YTD price gain, compared to a flat performance by the MSCI World Bank Index. Singapore’s listed Bank Sector consists of DBS Group Holding (DBS), United Overseas Bank (UOB) and Oversea-Chin

It should be another action-packed week for earnings, ahead of Chinese New Year on Friday. SATS (SGX: S58) will kick off proceedings on Wednesday. The airport-services company’s second-quarter numbers were bolstered by gains from the disposal of assets. Without the benefit of the gains, the underlying profits had still improved, though revenues dipped 0.8%. Transport company, ComfortDelGro (SGX: C52), is set to report full-year numbers on Tuesday, too. In November, it said net earnings fell 8%, while revenues slipped 2%. The bulk of the fall was caused by competition at its Singapore tax division, which the company hopes to address by forming an alliance with Uber. The Competition Commission of Singapore is expected to rule on the deal by the end of the month. Singapore Airlines (SGX:

2017 was indeed a fruitful year for Singapore Exchange, raising approximately $4.7 billion from the 21 successful IPO listings, as Clearbridge Health (Clearbridge) was the last company to debut on 18 December 2017 on Catalist of the Singapore Exchange. The shares of Clearbridge Health soared by 80.4 percent to close at $0.505 on 25 January 2018 over a five-week period with an average volume of 3.1 million shares traded each day. Ageing population has been a critical issue for Singapore over the past decade. For the first time in history, the amount of people above 65 will match the amount of people under 15 by this year, according to a research note by United Overseas Bank economist Francis Tan. The occurrence for conditions such as cardiovascular diseases and cancer will be on the rise an