Part 3/10:

While asset quality remained stable through the quarter, there is widespread concern about potential deterioration as loan moratoriums—an emergency measure to support borrowers—begin to expire. The ongoing uncertainty surrounding COVID-19's evolution further complicates the outlook, with policymakers cautious about how the economic landscape will unfold in the coming months.

Most moratoriums in Singapore started in April and are scheduled to end by December. The expiration of these payment deferrals will be a critical phase, revealing the true health of borrowers and the extent of potential defaults. Monitoring of repayment trends will be essential in assessing future provisioning needs and the overall stability of the banking sector.