Channel NewsAsia Online
13 December 2006
Healthy growth in loan markets boosts margins for Big Three local banks
It has generally been a good year for Singapore’s three local banks – DBS, UOB and OCBC:
And there could be further growth ahead.
According to experts, the Big Three will have to be more innovative in their product offerings to fight the increasing competition from foreign Qualifying Full Banks operating in Singapore and lenders like GE Money.
Leon Perera, Group Managing Director, Spire Research & Consulting, says: “The success of GE Money for example, is a wake up call to the banks not to neglect the needs of low-income consumers who can be said to be under-banked. And
in this sector providing credit to the low to middle-income consumers, the banks will face non-traditional types of competition from, for example, thrift-and-loan societies, finance companies and so on.”
All three Singapore lenders have grown by expanding in the region. Analysts say Southeast Asia presents great growth opportunities for Singapore. This is because Singapore players had been working the ground over the past few years to establish a foothold whereas international rivals have neglected the region. Downside risks include the projected slowdown in the US, Japan and China markets.
Spire Research and Consulting is the leading research consultancy in global emerging markets. Spire's competitive advantage lies in its ability to deliver actionable intelligence on the external business environment in support of its clients’ strategic decision-making in marketing and business development. Spire's clients include 50 Global Fortune 1000 companies and government agencies in 15 countries. For more information, please visit www.spireresearch.com.