Singapore’s trio of local banks remained cautiously optimistic about their FY2023 performance, as they expect interest rates will largely remain elevated and continue to boost their net interest margins (NIM). The bank, however, warned of costs catching up. The DBS, UOB, and OCBC wrapped up 2022 with record results, as they continued to post strong earnings in Q4 of the year on the back of higher net interest income. Rate hikes by the Federal Reserve throughout 2022 have driven up the cost of borrowing and boosted the NIMs of banks. Analysts said the rate of NIM expansion has likely started to moderate. Eugene Tarzimanov, vice president – senior credit officer at Moody’s Investors Service, expects the three banks will further improve their profitability in 2023 after ending 2022 on a solid note.