Singapore's Hot-Again Housing Market Pays Dividends for Its Biggest Bank
(Bloomberg) -- Singapore’s newly buoyant housing market is proving a boon for its biggest bank.
DBS Group Holdings Ltd. nominated mortgage lending as a bright spot when releasing second-quarter earnings on Monday.
Chief Executive Officer Piyush Gupta said that after three quarters of subdued growth -- ushered in by housing curbs introduced in July last year -- “we’ve seen the bookings come back up.”
Gupta said second-quarter mortgage-loan applications were up 60% from the first three months of the year and “since bookings are up, you’ll see the flow through to the balance sheet” in the second half.
Read more: DBS Optimistic on Second Half as Earnings Beat Estimates
Residential home prices in Singapore jumped 1.5% in the three months through June 30, data last week showed, the steepest gain since the second quarter of 2018. Luxury purchases spurred much of the rise, and there was a strong increase in private apartment purchases by foreign buyers.
Despite the recent up-tick, the effect of last year’s cooling measures is still being felt.
Gupta estimated DBS’s mortgage book would grow by about S$1 billion ($729 million) in the second half, resulting in projected growth for 2019 of about S$2 billion. That compares with a forecast of around S$4 billion made at the start of 2018.
Admittedly, that’s “much slower than it used to be, but it’ll still be positive,” he said.
©2019 Bloomberg L.P.