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RHB ‘overweight’ on Singapore banks on expected Sibor rise

PC Lee
PC Lee1/2/2019 03:16 PM GMT+08  • 2 min read
RHB ‘overweight’ on Singapore banks on expected Sibor rise
SINGAPORE (Jan 2): RHB Research is maintaining Singapore’s banking sector at  “overweight” as rising Sibor is seen to offset the adverse effects from slow loan growth.
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SINGAPORE (Jan 2): RHB Research is maintaining Singapore’s banking sector at “overweight” as rising Sibor is seen to offset the adverse effects from slow loan growth.

After the 25bps federal funds rate (FFR) hike on Dec 19, the market now expects a milder 1-2 more hikes this year and the three-month Sibor rose to the current 1.89% from 3Q18’s average of 1.63%.

From its sensitivity analysis, RHB says a 1ppt slowdown in loan growth will be offset by a 10bps rise in Sibor.

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