Singapore banks projected to see rising margins through 2027

Major Singaporean banks are projected to see rising net interest margins (NIMs) through 2027, supported by low non-performing loan (NPL) ratios. According to UOB Kay Hian, DBS is expected to see its NIM rise to 2.01% by 2027, while OCBC is forecasted to reach 1.87% in the same year. Both institutions maintained NPL ratios at or below 1% during the first half of 2026.

In addition to banking stability, both DBS and OCBC are expanding their wealth management sectors. DBS currently ranks as the fourth largest private bank in Asia, while OCBC is targeting double-digit growth in wealth management fees and assets under management through its Bank of Singapore arm.

Regarding regional economics, OCBC forecasts Malaysia’s fiscal deficit will sit at 3.6% of GDP for both 2026 and 2027. This projection is slightly higher than the budgeted 3.5% for 2026, driven by rising subsidy and social assistance costs. The bank noted that elevated oil prices could maintain high fuel subsidy expenditures, potentially complicating fiscal consolidation efforts in Malaysia.