Singapore banks' profitability to weaken slightly in 2017: Fitch

Average ROE fell to 10.4% in 2016, from 11.7% for 2015.

Fitch expects profitability to weaken slightly in 2017, driven by higher credit costs and the subdued lending environment. This may be compensated by a widening in net interest margins (NIM) from higher short-term rates, in tandem with an expected increase in the US Fed Funds rate.

Here's more from Fitch:

The banks’ average fully loaded CET1 ratio strengthened to 12.6% in 2016 (2015: 12.0%), aided by discounted scrip dividend schemes for DBS and UOB, slower risk-weighted asset growth, and healthy internal capital generation. Our stress tests show that the banks’ solid capital buffers should enable them to weather a significant deterioration in credit quality.