The Week In Numbers: UOB And OCBC Disappoint

It was a disappointing week for two of Singapore’s biggest banks. Both United Overseas Bank (SGX: U11) and Oversea-Chinese Banking Corporation (SGX: O39) reported a drop in first-quarter profits. UOB said net income slipped 4.4%, while OCBC posted a 15% fall in profits for the first three months of the year.

The Bank of Japan, which never fails to surprise, caught markets on the hop again. But for all the wrong reasons. The much-vaunted “Big Bazooka” filled with money never materialised. It wasn’t even a pea-shooter. Instead, the Japanese central bank opted to do nothing. It kept its money-printing target at 80 trillion yen, it left interest rates unchanged at minus 0.1% and it will continue to buy riskier assets such as shares.

The US Federal Reserve also opted to do nothing too. But that was largely expected. It kept interest rates unchanged at between 0.25% and 0.5%. It also expressed confidence in America’s economic activity and it has kept the doors open for a possible rate hike in June.

The Monetary Authority of Singapore still expects the local economy to grow at between 1% and 3% this year. But it warned of pockets of corporate stress, easing margins and weaker business expectations.

Staying in Singapore, the local tourism industry can look forward to a S$700 million boost from the Tourism Development Fund. The TDF money will be used to help the industry reposition itself to take advantage of long-term growth in the face of short-term headwinds.

And finally, the debate over Britain’s exit from the European Union is heating up. Those in favour of Britain leaving Europe reckon that the UK economy could be richer if it left. An economist from Cardiff University believes that around 10 years after leaving Europe, Britain could be 4% bigger than if it had stayed in. But the Pro-Europe camp reckons it could take 10 years for Britain to negotiate a trade agreement with the EU if it decides to leave the bloc.

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