Heightened caution at Singapore banks as market uncertainties creep up despite resilient Q3 earnings

SINGAPORE’S banks are cautious about economic uncertainties that lie ahead, despite reporting resilient earnings for the third quarter ended September.

The three banks still expect wealth management and fee income to drive growth, but net interest income could be adversely affected by the impact of the macro and geopolitical environment on net interest margins (NIMs) and loan growth.

“Stable net interest income into 2024 is as good as we can get, with peak NIMs and soft loans growth, and earnings upgrade likely coming to an end in this rate cycle,” said Citi analyst Tan Yong Hong, who expects investors are bracing for an uncertain 2024.