Better margins, loan growth, non-interest income cushion DBS against Swiber fallout

Singapore

THE three local banks' second quarter results were not expected to be exciting, rather a confirmation that loans, margins and earnings would be either flat or on a slow slide reflecting the weak economy and market uncertainties, all of which flew out the window when oil services firm Swiber Holdings dropped its bombshell.

The collapse of Swiber on July 28 has hijacked attention from the banks' core lending business, which is healthy, and brought their exposure to the oil and gas sector front and centre though it represents between 4 and 6.6 per cent of total loans.