Bloomberg汇总投行观点：新加坡三大银行上周市值蒸发220亿美元后，麦格理、杰富瑞、富兰克林邓普顿呼吁逢低买入

A selloff in Singapore banks is sparking calls to buy the dip, with some analysts pointing to the lenders’ long-term growth prospects as the city-state strengthens its position as a global financial hub.

From Macquarie Group Ltd. to Jefferies Financial Group Inc. and Franklin Templeton Inc., analysts and fund managers are prodding investors to look past last week’s selloff, which erased a combined $22 billion in market value from the city state’s three biggest banks. Their optimism rests on Singapore’s growing status as a wealth hub, which is directly boosting profits at DBS Group Holdings Ltd., Oversea-Chinese Banking Corp. and United Overseas Bank Ltd.

“The long-term outlook still remains positive for the Singapore banks,” said Yiping Liao, portfolio manager at Franklin Templeton Global Investments. “Looking past the near-term, we expect net interest margins to trough in subsequent quarters and non-interest income to benefit from the structural shift in wealth moving to Singapore.”

The shift in sentiment comes after investors dumped shares of DBS, OCBC and UOB on concerns that a run-up in bond yields to multi-decade highs could erode their appeal as dividend plays and saddle them with losses on their bond holdings. While the full impact will become clearer when third-quarter earnings are released in the coming weeks, the rout has dented Singapore’s standing as one of Asia’s best-performing major stock benchmarks this year.

The selloff has made valuations more attractive to some analysts, with Singapore’s largest lender DBS now trading at price-to-book value of 2.9 times forward earnings, down from a September peak of 3.1 times.

The decline in bank shares “provides a good buying opportunity for long-term investors,” according to Joanna Cheah, an analyst at Jefferies. Net new money and assets-under-management trends remain healthy and are arguably better indicators of franchise momentum, while loan growth has also remained robust, she said last week.

To be sure, concerns of high bond yields persist, with hotter-than-expected US inflation on Wednesday fueling bets of more aggressive rate hikes by the Federal Reserve.

Rising long bond yields could trigger high mark-to-market losses on banks’ trading books and hurt capital activity, JPMorgan Chase & Co. warned last week. Citigroup Inc. analyst Yong Hong Tan also flagged the risk of weaker guidance on wealth-management fees if the current risk-off sentiment persists.

While the bank’s trading income may face greater headwinds this quarter, investors are likely to focus more on wealth management income and the outlook for net interest income in a rising rate environment, said Macquarie analyst Jayden Vantarakis.

The slide is “an opportunity to buy back in,” he said.