0412 GMT [Dow Jones] OCBC (O39.SG) +0.5% at S$8.02, tracking modest gains by most other blue chips after pullback in early trade. CIMB expects stock to go higher ahead of Aug. 31 ex-dividend date (bank paying dividend of S$0.14/share Oct. 22); "based on the share price performance in the past five years, traders might find some profit in buying ahead of ex-dividend trading and selling on the ex-dividend date." Tips immediate technical resistance at S$8.45-S$8.55, followed by S$8.70-S$8.80. On fundamentals, house expects earnings improvement in coming quarters on back of lower provisioning charges, higher contributions from insurance arm Great Eastern Holdings (G07.SG), easing credit concerns. Rates at Outperform with S$8.11 target. Current buying interest tame as volume light. (FKH)

0308 GMT [Dow Jones] STOCK CALL: Citigroup raises Great Eastern Holdings (G07.SG) target price to S$15.30 from S$12.20 on improving outlook. "Recovery of equity, and stabilization of debt markets should lift GEH's performance, and we now view 1Q09 was the cycle trough for premium sales and new business value." Keeps at Buy. Notes possible divestment of 30% of GE Life Malaysia would result in loss of about S$43 million in income contribution, based on FY08 profit, but may generate over S$490 million in sale proceeds. Says low-yield environment, more market-sensitive premium growth, competition and volatile markets making it more challenging to drive consistent earnings, but adds, "We believe GEH remains a well-managed, financially strong company, which may have potential to become a more active capital management play." Shares +1.3% at S$13.68; STI +2.0%. (LES)

0350 GMT [Dow Jones] STOCK CALL: Deutsche Bank upgrades UOB (U11.SG) to Buy from Hold, raises target price to S$20.30 from S$14.50. Raises DBS (D05.SG) target price to S$16.50 from S$14.00, maintains Buy rating. Raises OCBC (O39.SG) target price to S$8.10 from S$5.80, maintains Hold rating. Says rating change, higher target prices reflect better long-term growth prospects on more-benign economic outlook. Tips further upside for Singapore banks' share prices, driven by earnings upgrades on equity market rebound, normalizing loan losses and valuation multiple expansion; "despite recent share price strength, we see further upside from current levels." Notes Singapore banks tend to deliver strong absolute and relative share price performance in year following a trough in GDP growth, analysis of historical trends suggests more than 20% upside to current valuation multiples. DBS flat at S$13.88, OCBC down 1.3% at S$7.72, UOB off 0.9% at S$17.52 vs STI off 0.1%. (KIG)

0713 GMT [Dow Jones] STOCK CALL: HSBC upgrades OCBC (O39.SG) to Neutral from Underweight on view life insurance business in Great Eastern Holdings (G07.SG) will be bank's key growth driver for rest of 2009. Says Great Eastern's 1Q09 results, while partly boosted by non-recurring gains in Malaysia, suggest worst over for insurance business. Expects Great Eastern to account for 17% of OCBC's total FY09 income vs 10% in FY08; "its embedded value should also rebound given the higher prospective investment returns and the greater popularity of traditional life products." Tips OCBC as major beneficiary of Singapore's real estate market recovery as its loan growth in last few years driven mainly by property-related lending. Raises target price to S$7.50 from S$5.80, based on 1.35X P/B vs 1.20X previously, raises FY09-10 earnings forecasts by 4%, 22% to S$1.29 billion, S$1.64 billion respectively. Stock +1.2% at S$7.84; STI +0.6%. (FKH)

0843 GMT [Dow Jones] Outlook for Singapore banks has improved as pickup in city-state's GDP in 2Q09, increased property transactions reaffirm economy is past trough, paving way for better-than-expected earnings, says Bank of America Merrill Lynch. Notes number of condo units sold in 2Q09 doubled on-year, +81% on-quarter to 4,700 units. Lowers NPL forecasts for all three banks to 3% by December 2009 from 4% previously, to 4% by end-2010 from 5%; "channel checks suggest that asset quality is holding up well on a sequential basis. While we still expect NPLs to peak in 2010, we believe that NPL formation will moderate going forward. This should lead to lower credit costs ahead." Upgrades DBS (D05.SG) to Buy from Neutral with higher target of S$17.95 vs S$12.50 previously, OCBC (O39.SG) to Buy from Neutral with S$9.50 target vs S$7.25; keeps UOB (U11.SG) at Buy with new target of S$19.55 vs S$15.55. DBS +1.6% at S$12.58, OCBC +2.1% at S$7.29, UOB +1.0% at S$16.22. (FKH)