Fashion
DBS’ Tan Su Shan followed up on the estimates for a 2 percent of revenue cut, underlining that potential revisions could come should the pandemic prolong.
Soon after the bank’s chief executive Piyush Gupta announced a modest 1-2 percent revenue reduction, institutional banking head Tan Su Shan followed up by adding that the matter was a «moving target» and that potential revisions could come.
We are living day by day, week by week right now, she said in a report, highlighting that the estimate was based on the assumption that the pandemic would subside by mid-year. «The key here is to stay with the clients, watch everyone’s positions and make sure everyone is okay.»
According to Tan, non-performing loans are expected to increase from small and medium-sized enterprises across tourism, apparel, hospitality and other sectors tied to consumer demand. Nonetheless, she noted that Singapore and other parts of Asia are observing signs of stability fuelled by government stimulus though business confidence and a recovery in consumer demand still lag.
For 2019, DBS demonstrated resilience posting a 14 percent increase to net profits to a record S$6.4 billion ($4.5 billion) from a 10 percent year-on-year income increase. From such a position, its modest revenue cut projection signals greater risks in the broader financial industry, especially amongst players with greater China exposure.
AIA, for example, noted that face-to-face meetings in China, which account for 40 percent of sales, took a hit, though its online sales managed to partially offset the loss. Its soon to retire chief executive and president Ng Keng Hooi noted the headwinds the insurer faced from the coronavirus and low-interest rates but remains optimistic that «the industry would overcome this down cycle and come out stronger», in a report.
