Total banking assets expanded faster than the financial sector's 4.7% average growth, driven by stable deposits and strong capital buffers.

Singapore's banking sector posted a 6.8% compound annual growth rate in total assets from 2021 to 2024, significantly outpacing the broader financial sector's average growth of 4.7% over the same period, according to the Monetary Authority of Singapore's annual report. The financial services sector grew 6.8% in 2024 alone, more than double the 3.1% recorded in 2023, and accounted for approximately 14% of Singapore's GDP, Deputy Prime Minister and MAS chairman Gan Kim Yong said in the central bank's annual report released on July 15, 2025.

Banking Asset Growth Exceeds Broader Financial Sector

Total banking assets expanded at a 6.8% compound annual growth rate (CAGR) from 2021 to 2024, according to the MAS annual report published in July 2025. This rate notably exceeds the broader financial sector's average annual growth of 4.7% over the same 2021–2024 period, as reported by Central Banking in July 2025. The financial sector's growth surged to 6.8% in 2024 from 3.1% in 2023, driven by broad-based expansion across banking, fund management, and insurance, as reported by The Straits Times in July 2025.

Growth Rate (%) (%)Source: Orionmano Industries

The banking sector's 6.8% CAGR for 2021–2024 marks an acceleration from the 5.5% CAGR recorded for 2018–2023 for total banking assets, as cited by MAS managing director Chia Der Jiun in remarks reported by finews.asia in 2024. This sustained growth reflects a period of robust post-pandemic credit expansion and deposit inflows.

Structural Resilience Underpins Growth

The banking sector's asset expansion is supported by structurally sound funding and capital metrics. Stable non-bank deposits accounted for more than 80% of total banking system funding as of September 2024, according to the MAS Financial Stability Review 2024. The report notes that deposits registered robust growth over the past year, largely driven by higher deposits from individuals, supporting the banking sector's capacity to supply credit to the economy.

Capital buffers remain well above regulatory thresholds. Local banking groups' aggregate Common Equity Tier 1 (CET1) capital adequacy ratio stood at 16.7% as of Q3 2024, according to the MAS FSR 2024. This is substantially above regulatory requirements, with strong capital buffers supplemented by ample provisions ensuring banks are well positioned to withstand any deterioration in credit conditions, the review states.

Asset quality remains healthy despite still-elevated borrowing costs. The overall banking system non-performing loan (NPL) ratio declined to 1.7% in Q4 2023 from 1.8% in Q4 2022, according to the ASEAN+3 Macroeconomic Research Office (AMRO) Singapore 2024 annual consultation report. The NPL across sectors are either at low levels or have seen significant reduction in 2023, with the exception of construction. The loan-to-deposit (LTD) ratio for Singapore banks has continued to fall for both Singapore dollars and foreign currencies, indicating surplus liquidity in the banking system, AMRO notes. Local banking groups maintained healthy provisioning coverage of 252% as of Q3 2024, alongside improvements in NPL ratios, per the MAS FSR 2024.

Sub-Sector Performance: Asset Management and Insurance

Banking growth occurred within a context of differentiated performance across other financial segments. The asset management industry recorded assets under management of S$5.4 trillion (approximately US$4 trillion) in 2023, growing at a 10% CAGR over the past five years, according to finews.asia reporting on the MAS annual report in 2024. This demonstrates the continued expansion of Singapore as a regional fund management hub, though the 10% AuM CAGR is partly influenced by market valuation effects alongside net inflows.

The insurance sector showed more moderate expansion. Total assets grew 6.8% in 2023, with net premiums increasing 6.4% over the same year, according to remarks by MAS managing director Chia Der Jiun reported by finews.asia. This growth rate aligns broadly with the banking sector's trajectory, though insurance assets represent a smaller share of total financial sector assets.

Outlook: Moderation Expected Amid Global Headwinds

The 2021–2024 average growth rate of 4.7% for the overall financial sector met the MAS's target of 4–5% annual growth during this period, managing director Chia Der Jiun said at the launch of the annual report on July 15, as reported by Central Banking. However, the MAS has explicitly cautioned that the pace of recent years is unlikely to persist.

"The pace of the last few years is unlikely to persist as the industry braces itself for slower global growth amid tariff uncertainties," MAS chairman Gan Kim Yong stated in the annual report, as reported by The Straits Times on July 15, 2025. The outlook anticipates headwinds from escalating trade tensions, sustained high interest rates, and slower global economic growth, all of which could dampen demand for banking services and credit.

While the banking sector's 6.8% CAGR over 2021–2024 has been robust, industry projections point toward a moderation toward the 4–5% target range, consistent with the broader financial sector trend. Banks' strong capital and liquidity positions suggest they are well-equipped to manage the uncertain macrofinancial outlook, but the structural drivers that powered the post-pandemic surge—including rapid deposit growth and low credit losses—are expected to normalize in a more challenging operating environment.