Part 4/10:
Several macroeconomic factors pose risks to the banks' outlook. The specter of a global recession remains a primary concern, especially considering the slowing economies in the U.S. and Europe. Compositionally, the banks' exposure to regional economies and the commercial real estate sector also warrants vigilant monitoring.
In particular, the cyclical nature of these sectors means that cracks could appear if economic conditions deteriorate further. For Singapore—an open economy with substantial regional linkages—any slowdown in inbound capital flows or regional economic activity could dampen the banks' growth prospects.