SECTOR UPDATE
Banking – Singapore
The Trend Is Your Friend

Monetary policy has reached an inflexion point as G7 countries have experienced a rapid recovery from the COVID-19 pandemic. BOC and BOE have scaled down their bond purchase programmes as well. We expect the transition in monetary policy from accommodation to tightening to trigger a re-rating for Singapore banks, pushing valuations toward upcycle levels. BUY OCBC (Target: S$15.50), followed by DBS (BUY/Target: S$35.45). Maintain OVERWEIGHT.