SG Banks: Credit Suisse expect better loan growth to drive FY11E earnings momentum, with SG govt raising 2011E GDP growth to 5-7% from 4-6% previously.
Combined with higher inflation, loan growth across Asia has been surprising
on the upside. House revise 2011 loan growth assumption for UOB to 18% from 16%, DBS to 14% from 13% and OCBC to 15% from 13%...
Add that 1Q11 qoq loan growth in SG vs overseas was 4.3%/2.7% in DBS, 6.1%/7.9% in UOB and 2.7%/6.1% in OCBC. Tip stronger loan growth means better fee income (especially loan related fee) and importantly, faster overseas growth brings with it wider NIMs (expected to bottom in 2Q11). House upgrade UOB to O/P from Neutral and is house top pick in the sector.