DBS vision for the future

DBS commodity trade Finance

SINGAPORE Oct 17 (Reuters) - Commodities financing has become the fastest growing business for Singapore bank DBS Group Holdings less than two years after it entered the segment, benefiting from the withdrawal of some European lenders in Asia, its CEO said.

Southeast Asia's biggest and most profitable bank has built a nearly S$25 billion ($20.48 billion) loan book by funding the trade in products such as oil and coal, said chief executive Piyush Gupta. About 100 people work in the unit that provides trade finance as well as hedging and broking to clients.

It marked the first time DBS - whose biggest shareholder is Singapore state investment firm Temasek Holdings with a 29.5 percent stake - has revealed details of its commodities business.

"It is the fastest growing part of our book right now, " Gupta said at a news conference on the opening of the bank's new headquarters in Singapore.

"It has been timely as the European banks withdrew over the last year. Our ability to step into the space and supplement some of the requirements of our customers was actually very proficuous, " he said.

Other Asian banks have also stepped in to fill the gap left by European lenders such as Credit Agricole and Societe Generale, which are scaling back their Asian operations to conserve capital amid the euro zone debt crisis.

A stiffer regulatory environment governing the trade of U.S. linked futures contracts is also causing some banks to curtail their commodities financing activities.

Analysts and loan bankers have said DBS has been the most aggressive among Singapore's banks in entering the commodities funding market. Its main local rivals Oversea-Chinese Banking Corp and United Overseas Bank have so far not disclosed data on the business.

Asia-focused Standard Chartered also has boosted its commodities funding businesses in recent years, analysts said.

Gupta said DBS's commodities business has units in London Singapore, Hong Kong and the Greater China region.

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World Bank worries will drag DJIA down today.

by --__--

See you at 6000.
Developing world may need $700 billion -World Bank
Sun Mar 8, 2009 7:42pm EDT
By Lesley Wroughton
DAR ES SALAAM, March 8 (Reuters) - Developing countries could face a financing gap of $270 billion to $700 billion this year as trade income dwindles and rich nations vie for capital to deal with a global slump, the World Bank said on Sunday.
The World Bank said even at the lower end of that estimate, resources of international institutions would not be sufficient to meet the financing needs as more and more emerging and developing countries are hit

Ahem...

I must take issue.
Asset prices inversely related to interest rates? No. Pull out some charts. Historically, commodity prices and bond yields move in tandem, especially noteworthy in times of monetary inflation, which btw estimated US M3 growth is more like around 9% here lately. US housing hasn't slowed overall credit growth one iota.
Judging from Chindia's changing lifestyle in regards to consumption, I couldn't disagree more regarding supply/demand issues on commodities. If anything, I'd say comm prices are suppressed by Paulsen & co, and don't reflect true supply/demand issues now

Speculate this

by someone_really

Amalgamated Bank, which manages worker retirement funds, today sought to freeze the bank accounts of senior executives at Enron Corp., alleging they reaped huge profits by artificially inflating the stock price of the once-mighty energy trader.
In a lawsuit filed in U.S. District Court in Houston, the bank called Enron a 'grotesque fraud,' and said insiders gained about $1.1 billion from the sale of more than 17.3 million shares of stock over the past three years.
Enron's market value peaked at almost $80 billion in August 2000, and has plunged to less than $1 billion after the Houston company said it misstated earnings by about $600 million and U

Pozen recs to SEC on financial reporting fall short.(GOVERNMENT)(Securities & Exchange Commission): An article from: Strategic Finance
Book (Institute of Management Accountants)

Commodity finance being done by Trading Houses  — Spend Matters
And banks fund these companies through trade lines, just like they fund so many hedge funds, factors, and others now interested in trade receivables. See – Shadow Banking Market grows and grows and Commodity Trade Finance – Still the Banks' Domain.

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Popular Q&A

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Which financial company provides commodity trading information?

Thomson Reuters provides a large amount of information in commodity trading. they provide an insight in several fields and they include guides in each of them.

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