Stock Name: UOB
Company Name: UNITED OVERSEAS BANK LTD
Research House: CLSA
It notes SIBOR remains tied to U.S. interest rates and there is little sign in the Singapore or U.S. yield curves of a rate recovery in 2011; “More rapid appreciation of the SGD could loosen the correlation between SIBOR and LIBOR, but we still expect SIBOR to follow U.S. interest rates directionally.”
Company Name: UNITED OVERSEAS BANK LTD
Research House: CLSA
CLSA stays Underweight on Singapore banks, with UOB (U11.SG), rated Buy with a $22.00 target price, its top pick. “While the December rise in bond yields fired the optimism of some observers, we think that recovery in Singapore interest rates - and thus bank net interest margins - remains unlikely in 2011.”
It notes SIBOR remains tied to U.S. interest rates and there is little sign in the Singapore or U.S. yield curves of a rate recovery in 2011; “More rapid appreciation of the SGD could loosen the correlation between SIBOR and LIBOR, but we still expect SIBOR to follow U.S. interest rates directionally.”
It adds, while bank NIMs should bottom out in 1H2011, “we caution that recovery in NIMs - required to power material pre-provision earnings growth - remains a 2013 story in our view.”
The house rates OCBC (O3.SG), down 0.1% at $9.01, at Underperform, with a $9.25 target and DBS (D05.SG), +0.6% at $14.12, at Underperform with a $13.60 target.
UOB shares are +0.7% at $18.24.
No comments:
Post a Comment