Three Risks for Banking in the Time of Coronavirus
Subdued loan volumes, pricing pressures and spikes in credit costs will nag pan-Asian banks.
Awaiting temperature checks outside a Singapore office building.
Photographer: BloombergWhen bankers fret about contagion, it’s usually the financial kind. DBS Group Holdings Ltd. is battling a different outbreak. The full-year results of Singapore’s largest lender are pre-coronavirus. Still, they offer clues to what investors in banks with pan-Asian heft — including HSBC Holdings Plc, Standard Chartered Plc and Citigroup Inc. — should be watching.
A day before its earnings report Thursday, DBS had to evacuate an entire floor of 300 people in its headquarters after one employee tested positive for the virus. Stressful as such situations are, big organizations like DBS have protocols to preserve business continuity. The bank, which now does a growing chunk of its business online, ought to be able to supply banking services reasonably efficiently. The main concern is whether the epidemic, which has hit its key markets of Singapore, Hong Kong and China, will sap demand for financial intermediation.