Why Singapore banks' robust loan growth in September could be short-lived

Property curbs will start to bite.

Despite a pickup in September’s loans growth, OSK does not foresee the growth momentum to continue into 4Q13. This will partly be due to seasonality and the property market cooling measures taking effect.

"We forecast slower loans growth for banks in the quarters ahead, and maintain our NEUTRAL call on the sector," says OSK.

Here's more:

September’s domestic banking unit (DBU) and Asian currency unit (ACU) loans growth gathers momentum. Loan growth picked up pace in September, with DBU and ACU loans expanding by 1.3% m-o-m (+16.4% y-o-y) vs August’s +0.7% m-o-m (+15% y-o-y).

Business and consumer loans improved slightly, with lending in the former rising by a quicker pace of +1.4% m-o-m (+17.9% y-o-y) vs August’s +0.8% m-o-m (+15.9% y-o-y). Consumer loans growth, meanwhile, ticked up 1.2% m-o-m (+12.3% y-o-y) vs August’s +0.7% m-o-m (+12.3% m-o-m).