SINGAPORE (Aug 15): As many as 75 funds available for sale in Singapore have a stake in DBS Group Holdings, Singapore’s largest lender. DBS shares have slumped nearly 8% since its exposure to struggling offshore oil and gas services firm Swiber Holdings came to light.
SGX-listed Swiber shocked markets on July 27 by saying it would wind itself up. The company subsequently changed tack by opting instead for judicial management. DBS has since disclosed it has S$721 million of exposure to Swiber, of which S$320 million is expected to be recovered. DBS had S$288.3 billion of loans as at 2QFY2016. For the quarter, the company charged off S$150 million against earnings for its exposure to Swiber.
Funds with the highest allocations to DBS (see table below) are mostly focused on Singapore equities, according to Morningstar Direct data. The S$62 million United Singapore Growth fund has the largest weighting in DBS at 13.9% (as at Dec 31, 2015). The United Singapore fund, managed by Victor Wong, has gained 2.1% this year while the Straits Times Index has risen 2.3%. Meanwhile the largest fund holding DBS is the team-managed S$10.2 billion Templeton Growth (Euro) fund, in Morningstar’s Global Large-Cap Value Equity category, which has fallen 2.9% this year.
Singapore’s three largest banks all have exposure to the oil and gas sector, with DBS the highest at S$23 billion or nearly 8% of total loans. In an Aug 9 report, Morgan Stanley equity analyst Nick Lord said, “We have a cautious view on Singapore banks due to concerns over top-line growth, risks to credit quality and regulatory uncertainty over capital, which will limit pay-outs.” Although valuations of Singapore’s largest banks are close to historical lows of the Asian financial crisis and 2003, Lord feels that this is justified.
Some funds have been trimming exposure to Singaporean banks, potentially minimising losses from the sector. For example, Kenneth Tang’s S$76 million Nikko AM Shenton Thrift fund, up 5.1% this year, reduced its holdings from 27.7% as at Dec 2015 to 17.7% as at June this year.
Readers can refer to Personal Wealth (Aug 8) for Singapore-focused funds that have the lowest exposure to the financial services sector.
| Name | Morningstar Category | YTD Returns(%) | Fund Size($ mil) | Portfolio Weight(%) | Portfolio Date(%) |
| United Singapore Growth | Singapore Equity | 2.1 | 62 | 13.94 | Dec 31, 2015 |
| Manulife Singapore Equity A | Singapore Equity | 1.9 | 12 | 13.31 | Mar 31, 2016 |
| Deutsche Singapore Eq A | Singapore Equity | 2.1 | 62 | 13.23 | Jun 30, 2016 |
| Schroder Singapore Trust A | Singapore Equity | 1.9 | 686 | 11.40 | Jun 30, 2016 |
| Nikko AM Shenton Singapore Div Eq SGD | Singapore Equity | 3.7 | 136 | 9.80 | Jun 30, 2016 |
| LionGlobal Singapore Dividend Eq SGD | Singapore Equity | 2.1 | 195 | 9.50 | Jun 30, 2016 |
| HSBC GIF Singapore Equity AD | Singapore Equity | -0.2 | 29 | 9.13 | Apr 30, 2016 |
| JPM Singapore A (dist) USD | Singapore Equity | 3.8 | 75 | 9.11 | Jun 30, 2016 |
| Legg Mason WA Singapore Opps I SGD Acc | Singapore Equity | -4.5 | 20 | 9.09 | Jun 30, 2016 |
| Aberdeen SP Singapore Eq SGD | Singapore Equity | 4.3 | 762 | 8.96 | Mar 31, 2016 |
| LionGlobal Singapore Trust SGD | Singapore Equity | 0.2 | 32 | 7.60 | Jun 30, 2016 |
| Nikko AM Shenton Thrift | Singapore Equity | 5.1 | 76 | 7.60 | Jun 30, 2016 |
| LionGlobal Singapore Balanced SGD | Asia Allocation | 3.0 | 67 | 7.60 | Jun 30, 2016 |
| Threadneedle (Lux) Dev As G&I ASC Inc | Asia-Pacific ex-Japan Equity | 8.7 | 45 | 7.51 | Apr 30, 2016 |
| LionGlobal Singapore/Malaysia SGD Other | Asia-Pacific Equity | 1.3 | 29 | 6.50 | Jun 30, 2016 |
| Fidelity Singapore A-USD | Singapore Equity | 2.7 | 103 | 6.46 | Jun 30, 2016 |
| UBS (Lux) EF Singapore (USD) (SGD) P | Singapore Equity | 3.9 | 89 | 5.95 | Apr 30, 2016 |
| LionGlobal South East Asia SGD | ASEAN Equity | 10.4 | 16 | 5.90 | Jun 30, 2016 |
| United Asia Financials Fund | Sector Equity Financial Services | -2.8 | 3 | 5.42 | Dec 31, 2015 |
Notes: Data sourced from Morningstar Direct and Fund Factsheets. Returns as at Aug 11 and in Singapore dollar terms. Only funds whose portfolio dates are after Dec 31, 2015 are included.
- Li Ka-shing's CK Hutchison mulls global telco assets spin-off, eyes London listing, Reuters reports
- MetMalaysia can issue quake warnings within eight minutes, says DG
- Businessman with 'Tan Sri' title, said to be O&G industry veteran, arrested for RM10m scam
- Trump pressing advisers for tariff escalation ahead of April 2, Washington Post reports
- Myanmar hit by fresh 5.1 aftershock, tremors felt in neighbouring countries
- Ukraine to seek more US investments in talks over economic deal — Bloomberg
- Businessman with 'Tan Sri' title, said to be O&G industry veteran, arrested for RM10m scam
- Indonesian Muslims to celebrate Eid on Monday
- Myanmar hit by fresh 5.1 aftershock, tremors felt in neighbouring countries
- Myanmar's quake toll passes 1,000 as foreign rescue teams arrive