How Did Singapore’s Bank Stocks Fare in 2016?

Another year has come to an end and it is time to tally up the scores.

recent report by bourse operator Singapore Exchange Limited (SGX: S68) provided information on Singapore’s three listed domestic banks, namely, Oversea-Chinese Banking Corp Limited (SGX: O39), United Overseas Bank Ltd (SGX: U11), and DBS Group Holdings Ltd (SGX: D05).

The report included information on the bank stocks’ performance in 2016 and their valuations and dividend yields at the end of the year. So, here they are (figures as of 30 December 2016, unless otherwise stated):

  1. When it comes to stock performance, DBS Group and UOB are tied for first place with a total return of 8.1% in 2016. OCBC lagged the two with a total return of 5.6%. But, all three banks delivered higher returns than the Straits Times Index (SGX: ^STI). Singapore’s stock market benchmark recorded a total return of 3.8% in 2016.
  2. OCBC offers the highest dividend yield of the trio at 4%. DBS Group sports a 3.5% dividend yield while UOB is at 3.4%. The Straits Times Index’s 30 components (the three banks are part of the group of 30) have a simple-average yield of 3.7%.
  3. The price-to-book (PB) ratio could be a useful measure of value for Singapore’s banks. By this measure, DBS Group edges it with a PB ratio of 1. OCBC and UOB are not far behind, though, with a PB ratio of 1.1 each.

All the data seen above provides a brief comparison of Singapore’s three major banks on three dimensions: Their valuation, dividend yield, and performance. They could be useful starting points for further research for any investor who’s interested in bank stock in Singapore.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. The Motley Fool Singapore has recommended shares of Singapore Exchange and United Overseas Bank. Motley Fool Singapore contributor Chin Hui Leong doesn’t own shares in any companies mentioned.