GDP at Current prices and PPP € 210 billion

Inhabitants 4.48 million

GDP per head € 46,832
Economic growth rate 8.1%
Consumer confidence indicator 111
Unemployment rate 2.7%
Consumer Price Index 1.0%
Banking staff 106,300
Number of branches 200
Number of ATMs 1,590
Households savings ratio -
Inflation rate 1.0%
Interest rate, consumer credit 17.80%
Interest rate, residential mortgage 5.73%
Interest rate on long term bonds 3.05%

Type and size of players

Net Banking income (in million SGD)

% Total assets
• The Singapore retail banking industry is dominated by 3 major banks, as a group forming
approximately 67% of total assets.
• The remaining 33% is occupied primarily by foreign banks and specialist finance
companies.

Products
% Market Share

Loans
• Singapore’s robust economic growth, low unemployment and inflation have promoted high
consumer confidence and the continued uptake of loans throughout the market. In particular,
Singapore’s property boom continues to drive loan growth as Singapore’s major domestic
banks each recorded a significant increase in loan activity in their 3rd quarter results (OCBC:
15%, DBS: 23%, UOB: 15.6% over the 3rd quarter in 2006).
• Following the shocks of the US sub-prime credit crisis, Singapore’s major banks have
emerged relatively unscathed as CDO’s (Collateralised Debt Obligations) form only a small
portion of their total assets. Of the major banks, OCBC has adopted the most conservative
position, as it sets aside $221 million in loan loss provisions for asset backed CDO’s.
Additionally, some banks have noted they expect greater pressure on interest margins due
to the higher cost of credit given ongoing liquidity challenges.
Credit cards
• Singapore’s major banks have responded to continued growth in personal wealth and
saturated market conditions by moving towards ‘lifestyle-centric’ and premium card products.
These cards offer exclusive discounts and benefits, which are tailored to specific
demographic segments of the population. For example, the DBS Women’s card offers
shopping deals, concierge services and special healthcare privileges.
• Banks have also moved to co-brand their cards with retailers (eg. OCBC’s Ikea friends
card), and more recently have also introduced a selection of ‘designer’ card styles, as they
seek to better identify with a cardholders personality.

Trends

Regulatory changes
• Singapore continues to refine it’s regulatory framework with plans to amend the Securities
& Futures Act (SFA) and the Financial Advisors Act (FAA). Such changes are intended to
strengthen safeguards and enhance the flexibility of the regulatory environment as
Singapore consolidates its position as a regional trade hub. This follows changes in early
2007, wherein the MAS was given enhanced powers in relation to distressed or insolvent
banks.
• The anxiety surrounding the credit crisis in the US sub-prime market has extended through
to Singapore and in response the MAS has streamlined the process used by banks to draw
down liquid reserves. Concurrently, the MAS is continuing to reform its liquidity risk
supervision framework as it moves towards allowing banks to hold a broader range of assets
to better manage liquidity risks.
Business model
• Following moves by the MAS to liberalise the banking sector, consolidation pressures have
eased as robust economic growth coupled with a booming property market have sustained
strong company results. Instead, the focus of major banks has shifted overseas, as banks
seek to tap into regional markets to support their next phase of growth. To this end,
Singapore’s major banks have established representative offices in Hong Kong, India and
South-east Asia. Most recently, Singapore’s banks have made efforts to expand into China
as the big 3 make strategic investments in local institutions and move to establish locally
incorporated operations. May 2007 also saw the establishment of Singapore's first locally
based Islamic bank, the Islamic Bank of Asia.
• On the domestic front, Singapore’s major banks are looking to tap into the burgeoning
mass affluent market as the positive economic climate continues to fuel growth in personal
wealth. Banks continue to pursue the elusive goal of leveraging established transaction
banking relationships to cross sell asset management and premium banking services. An
increased focus on wealth management has seen the start of a ‘war on talent’, as demand
for wealth managers exceeds supply.
Channel strategies
• Singapore’s major banks continue to develop offerings in the electronic payments arena, as
they seek to improve customer convenience and create a differentiated offering. For
instance, in July 2007, UOB launched a contact-less credit card that allowed cardholders to
purchase small value items by waving their card in front of a reader. Interestingly,
Singapore’s major banks are reluctant in adopting new security measures and introducing
EMV (EuroPay Mastercard Visa) chip cards. UOB remains the only major domestic bank to
have adopted EMV technology, with Citibank only recently have decided to move to the EMV
standard.
• Following a tentative start to mobile banking in the early 2000’s, there has been a recent
shift in consumer attitudes that has allowed the major banks to renew their focus on this
channel. Currently, only OCBC offers a full suite of banking services on a mobile platform
that is integrated with its internet banking services. Mobile services range from; account
enquiries, bill payments and fund transfers to downloading eVouchers, dining searches and
rewards redemption. In introducing this new service, OCBC has moved to allay security
 concerns by offering the mobile phone as a physical security token to facilitate two factor
authentication.

Credit Card Debt in Singapore Was over $S2.6

Billion and Accounted for 2.9% of Household
Debts.
DUBLIN, Ireland -- Research and Markets
(http://www.researchandmarkets.com/reports/c32603) has announced the addition of Plastic
Cards in Singapore 2005 to their offering.

This report provides extensive coverage of the Singaporean plastic cards markets. It covers
information on cards on issue, balances outstanding, card transaction value and volume and
will also review recent competitive and regulatory developments.

Scope of this title:

--This report considers the growth of Singapores plastic card markets and provides further
evidence of how rapid this growth has been

--The report breaks down data on plastic card markets in Singapore by scheme and by issuer.
It also analyses competitor strategies.

--The report presents a series of forecasts of plastic card markets in Singapore for the period
2005-2009.

Highlights of this title:

Recently there has been media attention to high levels of credit card debt Singapore however
in 2004 credit card debt in Singapore was over $S2.6 bn and constituted 2.9% of the
consumer household debt levels

According to industry experts there are approximately 4.5 cards per eligible cardholder in
Singapore and issuers are challenged to maintain spending on their credit cards

It is our opinion that co-branded cards will be implemented as well as color cards for the
future in Singapore. We suggests encouraging loyalty throughout the life of the card and
further encouraging use of rewards programs.

Reasons to order your copy:

--Gain insight on key cards metrics including transaction volumes and values, number of
accounts and balances outstanding

--Examine the rationale for entering Singapores card markets

--Gain Our insight on the future of the Singaporean cards markets

Topics Covered

Introduction

What is this report about?

Who is the target reader?

How to use this report

Our Cards and Payments Knowledge Centre

MARKET CONTEXT

Key findings

Country overview

Country overview

Economy

Demographics

Market size

Payment cards in the context of consumer credit.

Payment card statistics

Market infrastructure

ATM statistics

POS statistics

Regulatory environment

Industry regulators

Industry associations

Credit bureaux

Regulatory issues in the market

COMPETITOR AND PRODUCT OVERVIEW

Key findings

Card scheme market shares

The significance of Hong Kong's credit card market for Singapore

Card issuer market shares

Credit card competitor market shares

Product analysis

Typical product design - price, fees, incidence and type of loyalty

Product innovations in the market

FORECASTING THE PLASTIC CARD MARKET IN SINGAPORE

Forecasting the pay later card market

Macroeconomic Factors
APPENDIX

Supplementary data

Definitions

Future readings

Relevant links

For more information visit http://www.researchandmarkets.com/reports/c32603

Source: Datamonitor