Following MAS decision to guide SGD higher at slightly faster pace, DMG says foreign investment funds will flow in, SIBOR will remain soft, meaning narrower NIM for Singapore’s 3 banks, particularly DBS (D05.SG), which has lowest loan/deposit ratio, says Dow Jones. 

 

House Neutral on banking sector, UOB (U11.SG) remains best pick, DBS least preferred. For property sector, says soft SIBOR will mean lower financing cost for property buys, which will help drive demand while expectations of rising SGD will increase foreign interest in Singapore property. “However, the benefits will be offset by government measures to cap the rise in property prices.” House’s best pick remains Keppel Land (K17.SG). 

 

Adds, key beneficiaries will be companies with greater percentage of domestic landbank e.g. Wing Tai (W05.SG), City Development (C09.SG) and SC Global (D2S.SG). UOB +0.1% at $18.84, DBS +0.4% at $14.82. Keppel Land +0.2% at $4.27, City Dev +2.0% at $13.56.