OREANDA-NEWS. Singapore’s Financials sector, as categorised by the Global Industry Classification System (GICS®), consists of 29 stocks and has a combined market capitalisation of S$130.7 billion. It comprises companies involved in banking, thrifts & mortgage finance, specialised finance, consumer finance, asset management and custody banks, investment banking and brokerage and insurance. Although the three listed banks – DBS, OCBC and UOB – represent 10.3% of  the 29 financial stocks, they make up 81.1% of the total market capitalisation.

In 2015, according to the Singapore Department of Statistics, the Finance and Insurance industry contributes the fourth largest share of gross domestic product (GDP) in Singapore, at 12.6%. According to the latest Global Financial Centres Index (GFCI), the city-state was ranked Asia’s top financial centre and third globally behind Hong Kong and New York. The GFCI measures five areas of competitiveness, such as development of the financial sector, quality of labour force and regulations, as well as business environment and infrastructure.

The five largest plays in Singapore’s Financials sector have averaged a total return of 0.7% in the year-to-date, bringing their one-year and three-year total returns to 1.5% and 10.3% respectively. These five plays make up 94.7% of the total market capitalisation of the Financials sector.

The five largest stocks in Singapore’s Financials sector are tabled below and sorted by market capitalisation. Click on a stock name to access its profile page on StockFacts.

Almost two out of three stocks, or 19 of the 29 stocks, in Singapore’s Financials sector distribute dividends. These 19 stocks comprise a wide range of industries, including banks, capital markets, consumer finance, diversified financial services, insurance and thrifts and mortgage finance. The Financials sector as a whole averaged a P/B ratio of 3.2 and a Return of Equity (ROE) of 8.8%. It also maintains an average dividend yield of 4.6%, higher than the benchmark Straits Times Index’s (STI) 3.9%.

The five best-performing stocks in terms of total YTD returns that pay dividends are k1 Ventures (+52.6%), Maxi-Cash Financial Services (+35.9%), ARA Asset Management (+20.3%), G. K. Goh Holdings (+12.1%) and Hotung Investment Holdings (+10.7%). These five plays averaged a 6.6% yield.

These five stocks have been consistently paying out dividends at least once a year for the last five years, including 2016. Three of the five stocks – k1 Ventures, ARA Asset Management  and G.K. Goh Holdings – have grown their payouts by 71.9%, 4.6% and 5.9% respectively over the last five years.