OCBC / Wing Hang: difficult dollars Farewell, cheap money - you will be missed. Few places have enjoyed the flood of easy dollars, courtesy of the Federal Reserve, as much as Singapore and Hong Kong. So OCBC, Singapore's second-biggest lender, entering exclusivity talks to take over Hong Kong's Wing Hang looks like a case of two banks, stranded by a receding tide, clinging together. The situation is not so desperate or poetic, though one reason OCBC would buy a lender ranked 12th in its home market is that more deposits provide a buffer against the rising cost of money. Wing Hang has a good retail business in China's Pearl River Delta and Macau - another appeal for OCBC, whose big Malaysian business is a drag on growth. Trading at a flashy 1.7 times book, against a pedestrian return on equity of less than 10 per cent, Wing Hang is no bargain, unless compared with the eye-popping 3.5 times book that DBS, OCBC's home rival, paid for Dao Heng a decade ago. Should the deal go through, Fed tapering will remain a worry. Hong Kong and Singapore are the big Asian markets most closely linked to US monetary policy through their dollar-pegged currencies. Optimists note that squeezed net interest margins are set to improve. But it is not clear that the shift to paying more for money, and charging more for it, will be smooth - especially in two banking systems that are operating with loan-to-deposit ratios at decade highs. System deposits have risen by a compound 6 and 9 per cent a year in Singapore and Hong Kong, respectively, during the past five years, according to Barclays. Credit growth has run at 11 and 14 per cent. OCBC is unlikely to present the deal, when and if it closes, as a liquidity grab. It will find a growth angle to play up. But the deal would still mark the point when the tide of dollar inflows started to recede.