...Ratings Reflect Stronger Capitalisation: The ratings of Oversea-Chinese Banking Corp (OCBC) stem from the merits of its intrinsic credit profile. Management has delivered on plans made in 2014 to strengthen OCBC's fully loaded common equity Tier 1 (CET1) ratio, which had risen to be in line with local peers' at 12.7% at end-June 2016 (end-2014: 10.6%). We attribute this rise to the bank's capital retention, aided by its Scrip Dividend Scheme, and slower risk- weighted assets growth since its 2014 purchase of Wing Hang Bank (OCBC WH). Stable, Balanced Funding: OCBC's established franchise in Singapore underpins its stable, deposit-driven funding profile. This is supplemented by the bank's disciplined funding strategy in major foreign currencies. Customer deposits comprised 86% of total funding excluding derivatives at end-June 2016, and OCBC's loan/deposit ratio (LDR) of 83% and all-currency liquidity coverage ratio (LCR) of 130% indicated a liquid balance sheet. Resilient Banking Profitability:...
