Fitch Notes Singapore's Positive Recovery Trajectory

Fitch says Singapore's decision to remove restrictions on Singapore banks' dividend payments has no immediate impact on their credit ratings, they note that higher dividends from the three major banks in Singapore (OCBC, UOB and DBS) had already been factored into their assessments.

• The cap limiting banks dividend distribution in FY 2020 was put in place by the MAS in July 2020 as a pre-emptive measure to ensure adequate capital buffers. The Fitch report does acknowledge the removal of the cap is a positive development: "We believe the relaxation, announced on 28 July 2021, stems from continued stabilisation of banks' operating environment in line with a positive economic recovery trajectory. The results from additional stress tests conducted by MAS in mid-2021 also pointed to the banks' ability to weather lingering uncertainties."