Tue, May 01, 2018 - Page 10 News List

World Business Quick Take

Agencies

AVIATION

Vietnam mulls cargo unit

Vietnam Airlines Corp, which has been transforming its fleet with new widebody planes and expanding services, is looking to further boost growth by starting a dedicated cargo unit. The Southeast Asian nation has become a major manufacturing hub, with companies, such as Samsung Electronics Co, annually producing billions of US dollars in devices, providing an air freight opportunity for the national carrier, Vietnam Airlines chief executive officer Duong Tri Thanh told Juliette Saly in a Bloomberg Television interview. Investments by companies, such as Samsung, LG Electronics Inc and Nestle SA, have made the country a manufacturing powerhouse, fueling economic growth that has been among the fastest in the region. GDP rose 7.4 percent in the first quarter and the government forecasts growth of as much as 7.5 percent this year.

BANKING

DBS profit up on lending

DBS Group Holdings Ltd, Southeast Asia’s largest lender, posted an increase in first-quarter profit that beat analysts’ estimate thanks to higher lending and wealth revenue, while provisions for soured loans dropped. Net income climbed 26 percent from a year earlier to S$1.52 billion (US$1.15 billion) in the three months that ended in March, the Singapore-based company said yesterday in an exchange filing. That compares with the S$1.4 billion average estimate in a Bloomberg survey of five analysts. Rising local interest rates are helping the lenders charge more for loans, and DBS is earning higher wealth management fees after acquisitions helped it expand services for millionaires in Asia. Net interest income rose 16 percent from a year earlier to S$2.13 billion, driven by loan growth and the increase in benchmark borrowing costs.

BANKING

Australian banks face risk

Australia’s four major banks could suffer a ratings downgrade in the event of a severe housing market downturn with second-order economic effects, a stress test published yesterday by Fitch Ratings showed. The test was undertaken as risks within the household sector continue to grow, the ratings agency said, adding that Australian banks were vulnerable due to their large mortgage books. House price growth across Australia’s major cities have already tempered since late last year, and the run of losses is generally expected to continue as banks clamp down on so called “liar loans” amid an exhaustive year-long public inquiry. Just a few weeks after it commenced, a comprehensive, year-long Royal Commission has already uncovered a series of poor lending practices and wrongdoings among banks as they compete to expand their loan books.

EUROZONE

Lending growth slips

Growth in lending to the eurozone economy slipped slightly in March, but households’ and firms’ borrowing kept gaining momentum, European Central Bank (ECB) data showed yesterday. The pace of private-sector loan growth in the 19-nation single currency zone fell to 3 percent year-on-year in March, adjusting for some purely financial transactions, down from 3.1 percent in February and 3.3 percent in January. Both households and non-financial firms’ uptake of credit both picked up slightly in March, with all of the slowdown coming from non-bank financial firms, such as insurance companies and pension funds, the ECB data show.

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