DBS Group Holdings : DBS first-quarter earnings rise 16% from year ago to record SGD 933 million
04/27/2012| 03:55am US/Eastern
Quarterly income crosses SGD 2 billion on sustained
momentum across all businesses
SINGAPORE, 27 April 2012 - DBS Group Holdings'
first-quarter 2012 net profit rose to a record SGD 933 million,
up 16% from a year ago and 28% from the previous quarter. Total
income crossed SGD 2 billion for the first time from sustained
loan volumes, improved net interest margins, broad-based fee
income growth and higher customer flows for treasury products.
Return on equity rose to 12.8%, compared to 11.0% for full-year
Net interest income increased 4% from the previous
quarter to a record SGD 1.34 billion. Net interest margins
increased four basis points to 1.77% from higher loan yields.
Loans rose 3% excluding currency translation effects to SGD
198 billion, with Singapore-dollar loans leading the
increase. While loan growth moderated from recent quarters,
it is in line with market trends and the loan pipeline
remains healthy. Deposits grew 4% excluding currency effects
to SGD 232 billion mainly from US dollar, Hong Kong dollar
and Singapore dollar deposits. DBS' liquidity remained
healthy with the loan-deposit ratio easing to 85%.
Non-interest income increased 31% from the previous quarter to
a new high of SGD 820 million. Fee income rose 19% to SGD 406
million from higher contributions across a wide range of
businesses led by wealth management, lending, stockbroking and
trade and remittances. Trading income more than doubled to SGD
292 million from higher customer flows and more favourable
market conditions. Income from customer flows rose 71% to SGD
256 million, accounting for 39% of total Treasury net interest
and non-interest income.
Total income of SGD 2.16 billion was 13% higher than the
previous quarter. Expenses were little changed at SGD 898
million as higher staff costs were offset by lower technology
and other costs. The cost-income ratio was healthy at 42%.
Profit before allowances reached a record SGD 1.26
Asset quality continued to be strong. Non-performing
assets were unchanged from the previous quarter at SGD 2.91
billion, with the non-performing loan rate stable at 1.3%.
Specific allowances for loans amounted to SGD 43 million or
nine basis points of loans, similar to recent quarters.
General allowances of SGD 85 million were taken in line with
a prudent provisioning policy. Allowance coverage remained
strong at 128%.
DBS also continued to be well capitalised. The core
Tier 1 ratio of 12.7% (with phased-in deductions), Tier 1
ratio of 12.7% and total capital adequacy ratio of 16.4% were
above regulatory requirements.
DBS CEO Piyush Gupta said, "We continued to extend
our solid performance of the past eight quarters into 2012.
Strong business momentum, with key earnings drivers and
strategic initiatives kicking in, propelled the bank's
first-quarter earnings this year to yet another record high.
DBS' exceptional showing was underpinned by sustained
loan growth, broad-based non-interest income, as well as
higher contributions from all our markets. Our funding
capacity is robust, our asset quality remains sound and we
believe we are well placed to seize opportunities in the
DBS - Living, Breathing Asia
DBS is a leading financial services group in
Asia, with over 200 branches across 15 markets. Headquartered
and listed in Singapore, DBS is a market leader in Singapore
with over four million customers and also has a growing
presence in the three key Asian axes of growth, namely,
Greater China, Southeast Asia and South Asia. The bank's
strong capital position, as well as "AA-" and
"Aa1" credit ratings that are among the highest in
the Asia-Pacific region, earned it Global Finance's
"Safest Bank in Asia" accolade for four consecutive
years, from 2009 to 2012.
DBS provides the full range of services in consumer,
SME and corporate banking activities across Asia and the
Middle East. As a bank born and bred in Asia, DBS also
understands the intricacies of doing business in the
region's most dynamic markets. This market insight and
regional connectivity have helped to drive the bank's
growth as it sets out to be the Asian bank of choice. The
bank believes that building lasting relationships with its
customers is an integral part of banking the Asian
With its extensive network of operations in Asia and emphasis
on engaging and empowering its staff, DBS presents exciting
career opportunities. The bank acknowledges the passion,
commitment and can-do spirit in all of our 18,000 staff,
representing over 30 nationalities. For more information,
please visit www.dbs.com.