Banks

Banks: sees more headwinds as SIBOR drops to lowest level in 23 years at 0.52%, further restricting banks’ ability to charge on new loans. This spells more trouble for Singapore banks, which are already expected to see slower loan growth after the govt’s recent measures to cool the property market, and face greater pressure on net interest margins as Msian banks Maybank and CIMB step up competition in the local market….

A number of houses such as Citi, GS recently downgraded the sector in early Sep. Whilst DBS is most preferred for its cheaper valuations vs peers, and less impact from the property measures, we note that DBS suffers the most from weak SIBOR rates as it is the largest net lender in the interbank market...

Street gives wide range of recommendations for banks. Recent target prices as follows:
DBS: $13.40 - 19.44
OCBC: $8.40 - 11.80
UOB: $17.80 - 22.80