Analysts split over Keppel's S$230m default risk provision

Singapore

KEPPEL Corporation's provision of S$230 million for the Sete Brasil contract in its FY2015 financial results has triggered questions about how the conglomerate assesses the default risks stemming from a financially stricken client answerable for almost half of its S$9 billion net order book as at end-2015.

Some analysts have gone one step further in flagging more default risks, which have yet to be accounted for for the newbuild jack-ups worth in excess of US$5 billion that are either deferred on requests or have not been delivered to clients, according to Maybank Kim Eng.