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.

--With assistance from Chanyaporn Chanjaroen.

To contact the reporter on this story: Yongchang Chin in Singapore at ychin22@bloomberg.net

To contact the editors responsible for this story: Katrina Nicholas at knicholas2@bloomberg.net, Russell Ward

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