UOB Enjoys Big Rise In Brand Value; DBS Remains Number One

DBS has the most valuable brand in Singapore while rival United Overseas Bank has seen the largest value gain in this respect, a report showed.

Brand Finance, a strategy and valuation company, said in its Brand Finance Singapore 100 report that DBS remained Number 1 with the most valuable brand this year. Oversea Chinese Banking Corporation, or OCBC is in second place, with UOB in third.

UOB, ranked third this year, unchanged in that position from 2016, saw the monetary value of its brand rise to $3.619 billion from $2.762 billion a year earlier. DBS’s value was $5.4 billion, and OCBC was $3.643 billion, both up from a year earlier.

The Singapore Top 100 Brands report is published annually and incorporates data from all listed companies. Each brand is accorded a brand rating: a benchmarking study of the strength, risk and future potential of a brand relative to its competitor set; and a brand value, which is a summary measure of the financial strength of the brand.

The top 100 brands in Singapore had a collective worth of $42.6 billion, up 4 per cent from US$41.1 billion in 2016, the report said. (Values are in US dollars.)

To show how skewed results are among the largest groups, the 10 brands contribute 57 per cent of the total value while the bottom 50 brands contribute only 7 per cent of the total value.

The average ratio of brand value/enterprise value of the top 100 brands dropped from 18 per cent to 16 per cent.

Commenting on Singapore’s “Big Three” banks, Brand Finance said in its report: “The three local banks have been performing well for a number of years and in 2017, we see no other contenders capable of challenging the top three spots. DBS, with $5.4 billion brand value, holds its crown at the top of the Brand Finance Top 100 Most Valuable Singapore Brands table for the fifth consecutive year,” it said.

The report noted that in the case of DBS and OCBC, they have continued to buy foreign-owned banking businesses, such as in the wealth management space.

“We see the more aggressive moves from the banks particularly in M&A, with DBS acquiring wealth and retail business of ANZ in five markets and OCBC acquired National Australia Bank and Barclays’ wealth business in Singapore and Hong Kong. These will provide a boost to the brands’ values after the business integration and we expect the top 3 spots continue to be dominated by the banks next year,” David Haigh, group chief executive of Brand Finance, said.

"The three banks have contributed 30 per cent of the total brand value in Singapore, up from 27 per cent last year. The growth is in line with other financial brands around the world but we wish to see a more diverse mix at the top,” he continued.

The report also congratulated UOB on having the highest brand value increase amongst all the top 100 brands. “For UOB, there is possibly more upside in the future as their BSI has still room to grow and that will surely provide them with some buffer when DBS and OCBC integrate their acquisitions impact into the business and might report a higher revenue base”, Samir Dixit, managing director of Brand Finance Asia Pacific, said.

The Singapore Top 100 Brands report is published annually and incorporates data from all listed companies. Each brand is accorded a brand rating: a benchmarking study of the strength, risk and future potential of a brand relative to its competitor set; and a brand value, which is a summary measure of the financial strength of the brand.

Source: wealthbriefingasia

Nick Kalikajaros 2017