Société Générale May Sell Off Asia Private Banking Arm, Sources Say
News: Paris-based Société Générale is considering selling off its private banking operation in Asia, in a deal that could generate hundreds of millions of dollars, according to unnamed sources cited by Reuters. The lender - France ' s second-largest - is understood to be exploring a sale that could be worth around US$600mn, although sources added that a sale price had yet to be decided and could be higher. A spokesperson for the bank refused to comment on the news.
BMI View: Singaporean lender DBS suffered another setback to its aggressive expansion plans in Indonesia following the lapse of its share purchase agreement with Bank Danamon. The lapse was also a setback to banking sector relations between the Monetary Authority of Singapore (MAS) and Bank Indonesia (BI), who seemingly failed to come to terms over a banking reciprocity agreement that would have allowed DBS to seek a greater ownership stake in Danamon. In terms of Singapore's overall banking sector outlook, we note that while rising household debt levels do pose a non-negligible risk to the economy, affordability metrics as well as a solid medium term economic outlook suggest that a crisis is not in the cards.