Singapore banks won't get rid of oil slick yet

Around 18% of OCBC's on-balance-sheet loans to the offshore firms have gone sour.

Oil is still causing Singapore banks to lose their footing. The banking giants posted another spike in nonperforming loans because of souring advances to energy companies. Given the rate of deterioration, it may be wishful thinking to predict the worst is behind them, a report from Bloomberg said.

UOB saw its bad loan ratio rose to 1.6% at the end of September from 1.3% a year ago. It described the higher allowance for nonperforming loans as within expectations and said coverage remained strong. Meanwhile, OCBC bad loan ratio climbed 1.2% to 0.9%. Around 18% of its on-balance-sheet loans to the offshore firms have gone sour.  Back in June, DBS reported total exposure of S$23 billion to the oil and gas industry.

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