They can withstand potential losses from Asia’s oil and gas defaultsPETALING JAYA: Although highly exposed to credit risks emanating from the oil and gas (O&G) sector, Singapore banks remain well-placed to withstand potential losses, says Fitch Ratings. “This may seem high, although the majority of their O&G exposure is collateralised,” Fitch said in a statement. Concerns about Singapore bank’s exposure to O&G arose following several default cases. “Fitch believes Singapore banks are securely positioned to withstand further asset-quality deterioration, given their disciplined underwriting standards and healthy provision buffers of just over 100% (as a proportion of NPLs),” it said. “Adequate profitability, sound funding and liquidity positions, and strong capitalisation also support Singapore banks’ ‘AA-’ ratings, which we affirmed in May with ‘stable’ outlooks,” it added.

Source: The Star October 11, 2016 23:37 UTC