...Singapore Banks: A 50-Year Growth Story; Different Challenges Ahead This year marks 50 years of Singapore's independence, and a period of significant economic transformation (Figure 1). The banking system's rapid development has mirrored that of the economy (Figure 2); the three local banking groups ¡ DBS, OCBC and UOB ¡ are now the largest in the ASEAN grouping, and play an important role in a major regional financial centre. The banking sector's evolution is marked by key milestones: the division into the Domestic Banking Unit (DBU) and the Asian Currency Unit (ACU) in 1968, partly to protect the domestic market from external risks while promoting Singapore as a base for regional banking activities. Domestic financial deepening thereafter led to sustained growth in DBU balances (Figure 2). The period following the 1997-1998 Asian financial crisis was also pivotal ¡ the authorities encouraged domestic consolidation, and liberalised the sector to allow more foreign participation. This culminated...
