"Financial Expert" tries to alarm public with incompetent research

Image: Fabrications About The PAP

What do you think "Dr" Leong Sze Hian, a Harvard alumnus with 3 Masters and 2 Bachelors degrees but no PhD, is trying to do?

Yesterday (30 Nov 2015) Dr Leong wrote the article quoting a HK's publication dated "Jul 15" that requested Moody's credit agency downgrading the outlook of 3 main Singapore's banks from "stable" to negative.

But a search on Moody's website showed an announcement on 16 Jul 2015 that says the opposite of Leong's preposition:

" Moody's Investors Service has revised its outlook for Singapore's (Aaa stable) banking system to stable, reflecting the domestic property market's soft landing, and moderating domestic and cross-border credit growth. The outlook was previously negative since July 2013."

Moody's Investors Service, 16 Jul 2015

Here's the Moody article below:

Moody's: Singapore's banking system outlook stable, as property market eases and credit growth moderates Global Credit Research - 16 Jul 2015

Singapore, July 16, 2015 -- Moody's Investors Service has revised its outlook for Singapore's (Aaa stable) banking system to stable, reflecting the domestic property market's soft landing, and moderating domestic and cross-border credit growth. The outlook was previously negative since July 2013.

Moody's analysis is contained in its just-published report "Banking System Outlook: Singapore", by Eugene Tarzimanov, a Moody's Vice President -- Senior Credit Officer.

Moody's rates Singapore's three major banking groups—that account for around 60% of domestic system assets at end-2014—DBS Bank Ltd. (Aa1 stable, aa3), Oversea-Chinese Banking Corporation Limited (Aa1 stable, aa3) and United Overseas Bank Limited (Aa1 stable, aa3). Moody's also rates Bank of Singapore Limited (Aa1 stable, a3), the private-banking subsidiary of OCBC.

Moody's expects that Singapore banks will continue to benefit from healthy—although lower—economic growth both domestically and in their regional operations. While real GDP growth in Singapore will slow to around 3% in 2015 and 2016 as a result of slower growth in China, this will be offset somewhat by the recovering US economy.

"We expect moderate credit growth for Singapore banks in the next 12-18 months, which will help to regulate household and corporate leverage," says Tarzimanov. "But problem loans will increase somewhat during 2015-16, mainly from foreign loans, while the quality of domestic loans will remain stable."

Singapore's domestic property market is undergoing a soft-landing; regulatory steps and new housing supply have moderated prices for public and private housing by about 5%-7% since 2013. Moody's expects this trend to continue as additional housing supply comes online, interest rates gradually increase and current regulatory measures remain in place.

Capital buffers will stay strong, unaffected by credit costs as recurring earnings will cover gradually increasing loan-loss provisions, and risk-weighted asset growth will be in line with internal capital generation, says Moody's.

The rating agency expects Singapore banks to maintain stable loan-to-deposit ratios of around 90% in 2015-16, but profitability will decline as higher credit costs and slower loan growth weigh on margins. While higher interest rates will provide support to net interest margins, Moody's expects improvements to be very gradual and offset by these higher credit costs.

Systemic support for Singapore's large banks is very high, given their importance to the banking system and overall economy. In addition, the Singapore government's recently proposed bank resolution regime is among the most investor-friendly in the world, notes Moody's.

Moody's subscribers may access this report here:
https://www.moodys.com/researchdocumentcontentpage.aspx?docid=PBC_1006062

Source: 

Moodys -  https://www.moodys.com/research/Moodys-Singapores-banking-system-outlook-stable-as-property-market-eases--PR_329464