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ASEAN banks face sharper debt risks as interest rates rise

From Singapore to Thailand, lenders scrutinize exposure to shaky loans

With the Fed on the warpath this year to hike rates to tame inflation, Singaporean lenders have benefited as interest margins rose, but they now face debt risks. (Source photos by Shinya Sawai and Ken Kobayashi)

SINGAPORE -- Banks in the Association of Southeast Asian Nations are facing pronounced risks from exposure to loans commanding higher interest premiums as borrowers grapple with higher costs of repayment in an era when cheap financing has passed.

From Singapore to Thailand, lenders are watching their books for possible defaults as the price of borrowing increases amid a potential recession with the global economy burdened by a litany of headwinds, from geopolitical pressures to soaring costs as inflation persists.

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