Banks should stop share buybacks and cap their dividends
With a historic recession looming, they should aim to preserve capital and provide timely information to investors instead
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THREE weeks ago, I said in this column that I would be a buyer of Singapore bank stocks if they traded below their book values. When the buying opportunity that I defined presented itself recently, I began dipping my toe in the water, accumulating some shares in OCBC.
Talk about trying to catch a falling knife. Immediately after each of my buy orders was filled, the stock sank further.
Yet, it seems Singapore's three local banks - DBS, OCBC and UOB - see value in their shares too. Last week, they made headlines for their relatively aggressive share buybacks during the market's steep dive in the first three weeks of March.
