Connect with us
The clever new way to send money abroad

Banking

Asia Pacific Banks shrug off commercial property risks for now

Published

on

APAC commercial property prices were down around 3% on average in 2020, after a 1% rise in 2019. But the coronavirus-induced decline has been modest compared to past downturns, suggesting that the impact on banks’ commercial real estate loans will generally be much smaller this time.

Across individual markets, the pandemic’s impact on CRE prices is mixed. Singapore, Japan, and Hong Kong have been the hardest hit, whereas South Korea, China, and Indonesia have seen modest gains. Meanwhile, Hong Kong’s market is showing signs of a recovery after large price falls in recent years.

Office rents have stayed below the pre-crisis level of Q4 2019 in most APAC economies. Hong Kong and Singapore have fared the worst and retail rents in both cities remain under immense pressure, which could weigh on capital values. But industrial rents in Hong Kong have rebounded, supported by demand from tech and e-commerce players.

While credit risks in CRE loans have risen, APAC banks are generally well capitalised to cope with CRE-related losses. CRE loan exposures are also mostly not elevated. Policy actions offering relief for the sector and a global recovery should provide more support.

Still, banks will need to be vigilant about further price drops and the long-term impact of the pandemic. A key concern is whether the pandemic will trigger fundamental changes in demand for commercial properties, which could lead to chronic oversupply, depressed rents, and defaults.

Read More here

Click to comment

Leave a Reply

Economics

Thailand’s economic growth expected to return to 2019 levels in mid-2023

Although the economy would recover next year, the recovery is still substantially below potential level resulting in a large output loss and could affect Thailand’s potential economic growth in the future with the economy expected to return to 2019 levels in mid-2023.

Published

on

The Siam Commercial Bank (SCB), one of Thailand’s largest commercial banks, said in its latest economic outlook report that the country’s economy may wait until the second semester of 2023 to return to 2019 growth levels.

(more…)
Continue Reading

Banking

S&P maintains Thailand’s credit rating at BBB+ with stable outlook

Standard and Poor’s (S&P) maintained Thailand’s credit rating at BBB+ . The global rating firm expects the country’s gross domestic product (GDP) to grow at 1.1% this year, with a more optimistic growth at 3.6% per year from 2022 to 2024.

Published

on

Standard and Poor’s (S&P) maintained Thailand’s credit rating at BBB+ . The global rating firm expects the country’s gross domestic product (GDP) to grow at 1.1% this year, with a more optimistic growth at 3.6% per year from 2022 to 2024.

(more…)
Continue Reading

Most Read

Recent