BUSI­NESS Sin­ga­pore bank sus­pends loan deals for Lon­don prop­er­ties after vote

Weekend Argus (Saturday Edition) - - LIFE - ZLATA RODIONOVA

LON­DON: United Over­seas Bank (UOB), Sin­ga­pore’s third­largest bank by as­sets, has sus­pended loan ap­pli­ca­tions for Lon­don prop­er­ties due to the un­cer­tainty caused by UK’s vote to leave the EU.

The lender has said it is mon­i­tor­ing the mar­ket en­vi­ron­ment closely and will re­view it reg­u­larly to de­ter­mine when it will re­in­state its Lon­don prop­erty loans in the wake of Brexit.

“As the af­ter­math of the UK ref­er­en­dum is still un­fold­ing and given the un­cer­tain­ties, we need to en­sure our cus­tomers are cau­tious with their Lon­don prop­erty in­vest­ments,” a UOB spokesper­son said in an email to the Sin­ga­pore Busi- ness Times.

Other for­eign banks said their po­si­tions re­main un­changed. DBS Group Hold­ings, Sin­ga­pore’s big­gest lender, said it will con­tinue to of­fer fi­nanc­ing for prop­erty pur­chases in Lon­don but warned its cus­tomers to be cau­tious.

Tok Geok Peng, DBS ex­ec­u­tive di­rec­tor, said that even if the value of over­seas prop­erty rises, any gains will be eroded if the pound de­pre­ci­ates against the Sin­ga­pore dol­lar. “For cus­tomers in­ter­ested in buy­ing prop­er­ties in Lon­don, we would ad­vise them to as­sess the sit­u­a­tion care­fully be­fore com­mit­ting to their pur­chases as there could be po­ten­tial for­eign ex­change and sov­er­eign risks,” he said.

The Sin­ga­pore dol­lar gained about 10 per­cent against the Bri­tish pound in the af­ter­math of the ref­er­en­dum. But the full im­pact of UK’s vote to leave the EU mem­ber­ship on Lon­don prop­erty re­mains to be seen.

Nearly 40 per­cent of Lon­don’s 8.66 mil­lion peo­ple were not born in the UK. In ar­eas such as May­fair and the West End, 55 per­cent of the prop­erty mar­ket is based on non-EU buy­ers from the Mid­dle East, In­dia, Rus­sia and Africa.

Some es­tate agents in the UK said they have been swamped with calls from Chi­nese, Mid­dle East­ern, Ital­ian and Span­ish buy­ers look­ing for a bar­gain after the pound tum­bled to more than 30-year lows, mak­ing the ex­change rate very favourable for for­eign buy­ers.

Rus­sell Quirk, founder and chief ex­ec­u­tive of eMoov.co.uk, said the on­line agency had a “very busy week­end” after Brexit with a 50 per­cent in­crease in the num­ber of buy­ers from China and Sin­ga­pore com­pared to a week­end ear­lier.

But Fox­tons is­sued a profit warn­ing on Mon­day, cit­ing the ref­er­en­dum re­sult as a con­cern. – The In­de­pen­dent

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