In 4Q2023, the OCBC SME Index posted a reading of 49.5, remaining in contraction for the full year, Kwok points out. The index is based on the transactional data of more than 100,000 OCBC's SME customers in Singapore with annual sales turnover of up to $30 million.
Singapore’s small and medium enterprises (SMEs) may pose some threat to local banks as rising costs and economic risks would weigh on their risk profile despite budgetary aid for small firms, according to Bloomberg Intelligence.
In her Feb 21 note, credit analyst Rena Kwok says the outlook for Singapore SMEs’ growth appears subdued for 1H2024 on rising business costs and weak demand, especially for those not in expansionary mode. This could be followed by a rebound in 2H2024, premised on a slight recovery in manufacturing and external oriented sectors.
