Singapore STI Rises 0.8% as OCBC Private‑Banking Forecast 8% AUM Growth for 2026

Singapore Market Dynamics and Private‑Banking Outlook

1. Market Performance

On 6 January 2026, the Straits Times Index (STI) advanced 0.8 %, marking its second consecutive session of gains and lifting the index above the 4,680‑point threshold. The climb was driven primarily by gains in the Financials and Technology sectors, which rose 0.9 % and 0.7 % respectively. Market breadth widened, with 92 of the 50‑stock component companies reporting positive earnings revisions, while 8 remained flat or negative.

Key market metrics for the session:

The positive movement is consistent with broader Asian equity rallies observed in late December, where the MSCI All‑Asia ex‑Japan Index posted a 1.2 % gain. The global risk‑on sentiment is underpinned by expectations of stronger earnings from technology and consumer discretionary firms in the United States, as well as the continued fiscal stimulus in Japan.

2. Regulatory Context

2.1 Monetary Authority of Singapore (MAS) Guidance

MAS released its Monetary Policy Statement on 4 January, confirming a neutral stance on the Singapore Dollar (SGD) and reiterating its commitment to inflation‑anchored growth. The statement emphasized:

• Liquidity management: Continued provision of market‑stabilising tools to maintain price stability.
• Financial sector resilience: Ongoing supervision of banks’ capital adequacy and liquidity ratios, with a focus on the Basel III framework.
• Digital payments: Support for the adoption of the PayNow platform and the e‑SGD initiative, reinforcing Singapore’s role as a payments hub.

These directives provide a stable backdrop for institutional investors and may explain the sustained confidence in Singapore’s financial ecosystem.

2.2 Regional Regulatory Developments

In Hong Kong, the Hong Kong Monetary Authority (HKMA) announced an update to the Capital Requirements Regulation (CRR) for private‑banking entities, effective 1 April 2026. The new rules raise the Core Equity Tier 1 ratio threshold for high‑net‑worth individuals to 14 %, encouraging banks to deepen wealth‑management services without compromising prudential standards.

In Indonesia, the Financial Services Authority (OJK) introduced a framework for Family Office registration, aiming to formalise and standardise wealth‑management practices across the Greater Indonesia region. This aligns with Singapore’s positioning as a wealth‑management hub in Southeast Asia.

3. Oversight of Oversea‑Chinese Banking Corporation (OCBC)

3.1 Private‑Banking Outlook

The private‑banking arm of OCBC, operating as Bank of Singapore, issued a bullish outlook for 2026. CEO David Chen highlighted:

• Robust 2025 performance: The private‑banking division recorded a 12 % YoY growth in assets under management (AUM), reaching US $120 billion.
• Regional expansion: Strong presence in Singapore, Malaysia, Indonesia, Greater China, and the broader Asia‑Pacific, supported by a network of 15 boutique advisory offices.
• Wealth‑planning advantage: Singapore’s favorable tax regime, stable legal framework, and advanced fintech ecosystem enhance the attractiveness of wealth‑planning services for high‑net‑worth families.

Chen’s remarks underscore the bank’s confidence in sustaining this growth trajectory, citing a forecasted 8 % increase in AUM for 2026, driven by an inflow of US $7 billion in new wealth from Singaporean expatriates and Greater China investors.

3.2 Strategic Implications for Investors

• Diversification: OCBC’s private‑banking portfolio is geographically diversified, reducing concentration risk across ASEAN and Greater China markets.
• Capital Adequacy: The bank’s Tier 1 capital ratio remains above the regulatory minimum at 16.5 %, indicating a healthy buffer for potential market volatility.
• Fee‑based income: Private‑banking fees are projected to rise by 4 % year‑on‑year, driven by increased advisory and asset‑management services.

Investors may consider exposure to OCBC’s private‑banking segment through its public shareholding or through sector ETFs that track the broader Asia‑Pacific wealth‑management space.

4. Market Dynamics and Investor Takeaways

1. Momentum in the STI: With the index approaching a new 4,700‑point level, short‑term traders should monitor the 10‑ and 30‑day moving averages. A breakout above 4,700 may signal a bullish trend, whereas a reversal below 4,650 could indicate a consolidation phase.
2. Risk‑On Sentiment: Positive sentiment in Asian equities and favorable monetary policy positions in Singapore and Hong Kong suggest a continued upside bias for technology and consumer discretionary stocks. However, potential macroeconomic shocks—such as a rise in U.S. policy rates—could compress valuation spreads.
3. Private‑Banking Upside: The bullish outlook for OCBC’s private‑banking arm indicates potential upside in the bank’s earnings. Investors should watch for quarterly earnings releases to gauge the pace of AUM growth and fee‑income expansion.
4. Regulatory Watch: Upcoming regulatory changes in the UK, Europe, and the U.S.—particularly the European Central Bank’s Regulation on EU‑wide deposit insurance—could create comparative advantages for Singaporean banks that maintain a high standard of compliance.

5. Conclusion

The Singapore stock market’s continued ascent, supported by stable monetary policy and robust corporate earnings, reflects a broader positive market environment across Asia. At the same time, Oversea‑Chinese Banking Corporation’s bullish outlook for its private‑banking arm reinforces Singapore’s status as a premier hub for wealth planning and family office services. Investors and financial professionals should remain vigilant for regulatory updates and market shifts that could influence both equity and wealth‑management dynamics in the region.