DBS First-Half Earnings Rise To Record SGD 2.39 Billion

A strong second quarter, similar to the record first quarter, propelled DBS Group’s first-half 2015 net profit to a new high of SGD 2.39 billion. Excluding a one-time gain, net profit rose 12% to SGD 2.25 billion. First-half total income exceeded SGD 5 billion for the first time. Improved net interest margin, broad-based fee income growth and stronger treasury contributions resulted in a 14% increase in total income to SGD 5.43 billion.

Wealth Management contributed significantly to the impressive figures.

DBS CEO Piyush Gupta said, “Despite slowing growth across the region, DBS achieved record earnings in the first half of the year driven by strong broad-based income growth. Notably, net interest margin is at its highest in 13 quarters. In a reflection of our confidence in the sustainability of our earnings, we are pleased to raise first-half dividends to reward shareholders.”

For the second quarter, net profit rose 15% from a year ago to SGD 1.12 billion. Total income grew 16% to SGD 2.69 billion as net interest income and fee income reached new quarterly highs.

Asset quality remained strong. The non-performing loan rate stayed at 0.9% and allowance coverage was at 160%. Return on equity for the first half was 11.9% compared to 11.7% a year ago.

For the first six months, net interest income increased 13% to SGD 3.43 billion. Net interest margin improved six basis points to 1.72%. Loans grew by a reported 9% to SGD 280 billion. In constant-currency terms, loan growth was 5% as an increase in Singapore housing and regional corporate loans was partially offset by a decline in trade loans.

Non-interest income rose 16% to SGD 1.99 billion. Net fee income increased 13% to SGD 1.14 billion. Wealth management fees grew 34% to SGD 342 million from increased unit trust and insurance sales, while card fees increased 21% to SGD 207 million with higher customer transactions. Brokerage commissions rose 19% to SGD 101 million with higher regional equity market activity.

Trading income increased 17% to SGD 629 million as the Group was well-positioned in foreign exchange and interest rates during a period marked by central bank action. Gains on investment securities rose 46% to SGD 146 million from higher profits booked on government securities.

All business units’ income achieved new highs. Consumer Banking / Wealth Management income increased 28% to SGD 1.76 billion, with the Wealth Management customer segment rising 41% to SGD 743 million as assets under management increased 22% to SGD 143 billion. Institutional Banking income grew 7% to SGD 2.67 billion with contributions from lending and cash management activities leading the increase. Treasury income rose 28% to SGD 663 million.