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Don’t bet on OCBC to raise its dividends, says Credit Suisse

Michelle Zhu
Michelle Zhu7/12/2017 12:23 PM GMT+08  • 2 min read
Don’t bet on OCBC to raise its dividends, says Credit Suisse
SINGAPORE (July 12): Credit Suisse is downgrading its rating on Oversea-Chinese Banking Corporation (OCBC) to “neutral” from “outperform” with a lower target price of $10.90 given the bank has limited scope to raise its dividends given its current
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SINGAPORE (July 12): Credit Suisse is downgrading its rating on Oversea-Chinese Banking Corporation (OCBC) to “neutral” from “outperform” with a lower target price of $10.90 given the bank has limited scope to raise its dividends given its current capital position.

In a Wednesday report, analysts Danny Goh and Dawei Lee notes that OCBC’s CET1 ratio of 12.2% as at 1Q17 is the lowest among the three main Singapore banks.

The analysts also believe there could be downside risk to the management’s previous guidance for FY17 net interest margins (NIMs) to be at approximately 1.67%, similar to FY16 levels, given the divergence between local interest rates and US rates.

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