By Gabriel Chen

SHARES of Singapore's three banks slumped yesterday on concerns that their earnings will drop sharply in an economic downturn.

Sentiments were also not helped by DBS Bank's disclosure that it may have to set aside $70 million to $80 million to compensate vulnerable customers who had bought structured products linked to bankrupted investment bank Lehman Brothers.

The debacle exposed DBS to claims of mis-selling to retirees and other vulnerable folk, and finally brought offers of compensation on Wednesday evening.

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