Among the analysts, UOB is the favourite with a rating of 4.33 out of five, comprising 13 “buy” calls, five “hold” calls and no “sell” calls. DBS has a rating of 4.11 with 10 “buy” calls, eight “hold” calls and no “sell” calls, followed by OCBC, rated 3.89 with nine “buy” calls, nine “hold” calls and no “sell” calls.
For banks, the relationship between earnings growth, net profit, capital ratios, use of capital and Basel III reforms impacts dividends, capital management and share price.
Notwithstanding Asia’s reaction to the US elections, as at Nov 8, the local banks are up 29.5% on average in share price performance since the start of the year. Along with their generous dividends, banks have returned 36.8% on average this year. At the close of Nov 8, DBS Group Holdings, United Overseas Bank (SGX:U11
) (UOB) and Oversea-Chinese Banking Corporation (OCBC) returned 46.1%, 32.8% and 31.4%, respectively.
