Singapore Banks To Post Higher Q4 Profit, But Trump Tariffs Could Hurt 2025 Growth

Singapore: Analysts predict that Singaporean banks will announce increased profits for the fourth quarter, but growth may be negatively affected this year due to U.S. President Donald Trump's trade tariffs and other policies that could jeopardize the global economy. Banks in Singapore, the largest in Southeast Asia by assets, are expected to report increased net profit for the fourth quarter compared to last year, fueled by strong net interest income and rising fee income, according to LSEG estimates.

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Singapore banks' Q4 profits rise, growth risks persist.

The banks, like their regional counterparts, have gained from a prolonged high-interest rate setting and robust wealth inflows supported by the city-state's political stability. Nonetheless, Trump's trade tariffs on China and the potential for duties on other U.S. trading partners present risks to Singapore, a key global trading and financial centre. Analysts express that the primary concern is a growing cycle of retaliatory tariffs igniting a wider international trade conflict.

Singapore Banks Face Growth Risks Amid Earnings Projections

"In this situation, local banks might have to boost provisions for possible bad debts due to increasing growth risks, potentially impacting their earnings," stated Yeap Jun Rong, market strategist at trading platform IG (IGG.L), opens new tab. "Moreover, increased global uncertainty might reduce loan demand, as businesses and consumers take a more careful approach toward borrowing and expenditures," he noted. DBS Group (DBSM.SI), the largest of the three banks in Singapore, is expected to achieve a 9.8 per cent increase in net profit for the October-December quarter compared to the same period last year, based on LSEG forecasts.

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Oversea-Chinese Banking Corp (OCBC) (OCBC.SI), opens a new tab and United Overseas Bank (UOB) (UOBH.SI), opens a new tab is expected to achieve net profit growths of 11.6 per cent and 4.3 per cent for the quarter, according to the forecasts. DBS plans to disclose its results on February 10, whereas OCBC and UOB are set to publish theirs on February 19 and 26, respectively.