SINGAPORE - Banking professionals here are much more anxious about banks' outlooks this year compared to two years ago, according to an industry survey sponsored by accounting giant PricewaterhouseCoopers (PwC).
Singapore bucked trends to score 3.25 out of a five-point index this year (2014), a marked rise from 2.37 in 2012.
The result ranks Singapore the third-most anxious country, after Malaysia and Turkey.
This comes even as the biennial Banking Banana Skins survey done by the non-profit London-based Centre for the Study of Financial Innovation (CSFI) marked the first global decline in anxiety levels in seven years.
The survey took responses from 59 countries with over 650 bankers, banking regulators and observers, 15 of which were based in Singapore but mostly working in foreign banks.
Ms Karen Loon, Singapore banking & capital markets leader at PwC, said that the result was driven by "increasing pressures on several fronts".
"Singapore's response was dominated by concerns about the volume of new regulation and the consequences in terms of re-structuring, profitability and demand for additional capital, although a number of respondents recognised that new regulations would make banks safer," she added.
Regulation was ranked as the biggest risk area to banks both globally and in Singapore, partially attributed to tighter rules in Europe and the United States after the global financial crisis.
On a more encouraging note, she pointed out that professionals here also felt banks were more prepared for the challenges. Singapore ranked fifth globally on the survey's preparedness index with a score of 3.43, well above the global average of 3.04.
Mr Chris Matten, partner and Asia-Pacific financial services risk leader at PwC, said that there is almost an "inverse relationship" between anxiety and preparedness for most countries, where countries who are more anxious also tend to feel less prepared.
But Mr Dominic Nixon, global financial services risk leader at PwC, pointed out Singapore was a notable exception.
"I think this indicates that the government and industry are working together to ensure the risks are recognised," he added.