Singapore's central bank expressed concern at the growing mountain of household debt and surging property prices, saying they posed "significant risks" to the country's financial system.
While the city-state's banking system remains sound, the build-up in household debt was "worrying", said Ravi Menon, managing director of the Monetary Authority of Singapore (MAS).
He said a growing number of households have over-borrowed in the property market, largely due to low interest rates and stretched loan tenures.
"The combination of low interest rates, growing leverage and surging property prices poses significant risks to financial stability," Menon said at a news conference.
Global credit rating agency Moody's last week downgraded its outlook on Singapore's main banks from "stable" to negative", citing rapid loan growth and rising real estate prices.
Moody's said these "have increased the probability of deterioration in the banks' credit profiles under potential adverse conditions in the future".
Menon said an estimated 5 to 10 percent of borrowers in Singapore "have probably over-leveraged on their property purchases, that is, they have total debt service payments at more than 60 percent of their income".