DBS

DBS: Nomura maintains Buy, TP $15.80. Note that DBS sell-off on property measures exaggerated. DBS fell 3.7% yesterday (vs UOB -1.9% n OCBC -1.2%), knee-jerking banks appears overdone. YTD S$ loan growth is just 11% vs 22% for the broad loan book. YTD mortgage loan growth has been just 5.2% (mortgages make up 22% of loan book). Hence, S$ mortgages are NOT a key driver of loan growth for DBS (or any of the other SG banks).

SG banks are not extraordinarily exposed to the property sector – housing loans accounted for 17% of non-bank loans as at 3Q11, comparable to the medium-term average. More than 70% of outstanding housing loans are for owner-occupied residential properties. Further, household debt-to-assets is low at 15%, below the LT average of 18%. It appears the mortgage market can withstand the price ramifications of a drop-off in foreign interest.