DBS sees more provisions ahead in oil and gas portfolio
DBS chief Piyush Gupta said on Friday that specific provisions for its oil and gas portfolio could be higher than previous guidance.
Asset quality pressures will continue, said Mr Gupta at a press briefing, referring specifically to the smaller support services. He noted that the oil and gas service players lack pricing power. The prices that they are getting are "barely able" to cover operating expenses.
Specific provisions for its oil and gas portfolio could be S$300 million next year.
Excluding exposure on Swiber, DBS has a S$7 billion exposure to the oil and gas support services. Of this, S$1.6 billion are to state-owned and government-linked shipyards, while the remaining S$5.4 billion are to the smaller players.
Mr Gupta added that there is a very clear strong pick-up in housing activity. This comes as the bank's new bookings in mortgages in the second quarter is at its highest in five years.
DBS now has a share of 28.7 per cent as at June 2017 in the housing loan market.
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