Oil has strengthened, but Singapore banks not out of the woods yet

by Dramelin 8:00 PM 0 comments

"We expect the three banks` profitability in the fourth quarter to see negative pressure due to their exposure to the oil and gas sector. Over the past year, the banks set aside hundreds of millions in extra Singapore dollars after offshore services firm Swiber Holdings unexpectedly filed for bankruptcy. Stronger global oil prices have yet to benefit the offshore marine sector, whose continued troubles are expected to dominate the narrative this week when Singapore`s three largest banks release their earnings reports. All three Singapore banks are due to report their fourth quarter earnings this week, starting with Oversea-Chinese Banking Corporation (OCBC) on Tuesday, followed by DBS Group Holdings on Thursday and United Overseas Bank (UOB) a day later. Analysts told CNBC that the continued struggles among oil and gas debtors could lead to the banks ? among the largest in Southeast Asia ? setting aside more money for potential losses, which threatens their bottom lines.