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SINGAPORE: OCBC Bank said its exposure to Lehman-linked minibonds is not expected to be significant. The comment came as the lender released its third-quarter earnings on Wednesday.
The bank said it is following guidelines issued by the authorities and it is looking into complaints, especially from vulnerable customers like the elderly.
Another issue addressed by OCBC's CEO, David Connor, was the bank's exposure to the Marina Bay Sands project.
OCBC is one of the three local banks which have extended loans – totalling some S$2 billion – to the parent-company Las Vegas Sands to fund the integrated resort development.
Concerns arose when the share price of Las Vegas Sands fell by over 90 per cent recently, sparking fears that the resort may not open by end-2009. There are also concerns that Las Vegas Sands may be in financial difficulties.
Mr Connor said OCBC's exposure to the project is quite manageable and that the financing project will not be "contaminated" by Las Vegas Sands in any way.
But the bank said Las Vegas Sands has injected more capital than needed at this stage and it believes the operator will have sufficient funds to complete the project. Even if it cannot, new partners could potentially come on board.
OCBC posted a 13 per cent decline in quarterly profit for the three months ended September to S$402 million. The bank said it is well-placed to deal with the challenges ahead.
Going forward, the lender said it is looking into expanding its operations in China and setting up an Islamic banking branch in Malaysia.
- CNA/so
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