CNBC has an article expressing some concerns about Asian household debt with the article noting that Frederic Neumann, an economist at HSBC, commented in a note on Friday:
“In the last several years, consumer debt has surged across the region, financing not only purchases of new, flashy condos, but also of cars, motorcycles, and everything else the heart desires.”
The article goes on to explain that pawnshops are on the rise in Singapore with pledges at the city state’s pawnshops rising to 4 million in 2012 from 2.7 million in 2007 while loans have surged around 344% over the same period to 7.1 billion Singapore dollars in 2012.
Analysts Jarick Seet and Terence Wong were also quoted as saying that while the 2010 opening of the city-state’s casinos is likely a key driver for pawnshops’ growth, they also believe the government’s clampdown on unsecured lending and credit cards means more borrowers are facing difficulties with debt payments and are turning to their local pawnbrokers.
Nevertheless, HSBC’s Neumann believes a sudden credit blowup is unlikely due to the region’s stricter lending standards compared with the US and the UK, but he cautioned:
“Household debt may not be as big a systemic financial risk as it was in the West, but it highlights a potential growth problem in Asia: without it, how resilient would consumption spending really be?”
To read the whole article, Are Asian households over their head in debt?, go to the website of CNBC.
- The One Country With “Significant Real Income Growth” (Channel NewsAsia)
- Singapore Emerges as Asia’s Digital Securities Trading Hub (Nikkei Asia)
- The Singapore Story: Not a Sure Thing for Investors?
- Asia at a Crossroads: Demographics, Economics & Investment (State Street)
- Singapore Banks: Breaking Out (Smart Karma)
- FLASHBACK: An (Anonymous) Expat Rant About Singapore In: “i dun unerstan u lah!: An exposé of Singapore and Singaporean retardation”
- No Improvement in Asia Pacific Corporate Payments in 2015 (Coface)
- Asian Banks Are Nibbling the Lunches of Global Banks (CCTV)
- Luckin Coffee is Launching in Singapore, Will it Do Well? (Momentum Asia)
- Online Lynch Mobs Target Expats in Singapore (SCMP)
- United Overseas Bank (SGX: U11 / FRA: UOB / UOB0 / OTCMKTS: UOVEY / UOVEF): Betting on ASEAN Growth With 2M New Citibank Clients
- Why China’s ‘Crazy’ Mega-rich Are Moving Their Wealth, and Partying, to Singapore (SCMP)
- Singapore’s Sovereign Wealth Fund to Increase Investment in China (FT)
- DBS Group (SGX: D05 / FRA: DEVL / DEV / OTCMKTS: DBSDY / DBSDF): Record Earnings But Profit Margins From Higher Rates Have Peaked
- Asian Equities Well-positioned Against Global Recession (The Asset)