DBS first quarter net profit up 10%
(29 April 2015 – Singapore) DBS Group’s net profit for first-quarter 2015 increased to a record SGD 1.27 billion (A$1.21 billion), excluding one-time items of SGD 136 million, net profit was up 10 percent to SGD 1.13 billion.
Total income grew 12 percent to SGD 2.74 billion as net interest income and non-interest income both reached new highs.
The growth was broad-based across all business units.
Compared to the previous quarter, net profit before one-time items increased 35 percent, led by higher non-interest income. Return on equity was 12.2 percent.
Net interest income increased 14 percent to SGD 1.69 billion.
Loans grew by a reported 11 percent to SGD 281 billion; in constant-currency terms, loan growth was 6 percent.
An increase in regional corporate borrowing and secured consumer loans was partially offset by a decline in trade loans. Net interest margin increased three basis points to 1.69 percent.
Non-interest income crossed SGD 1 billion for the first time, rising 9 percent to SGD 1.05 billion.
Fee income increased 10 percent to SGD 560 million.
Wealth management contributions rose 43 percent from higher unit trust and insurance sales while fees from credit and debit cards increased 23 percent, DBS said this reflected a continuing strengthening of the wealth management and consumer banking franchises.
All business units achieved record income. Consumer Banking/Wealth Management income rose 29 percent to SGD 861 million, with the Wealth Management segment growing 41 percent to SGD 365 million.
Institutional Banking income was 5 percent higher at SGD 1.35 billion while Treasury income increased 38 percent to SGD 386 million.
Total expenses increased 13 percent, in line with income growth, to SGD 1.18 billion.
The cost-income ratio was at 43 percent. Profit before allowances rose 10 percent to SGD 1.56 billion.
Compared to the previous quarter, net interest income increased 1 percent, loans increased by a reported 2 percent but were little changed in constant-currency terms.
While regional corporate and secured consumer loans grew, trade loans fell in line with lower commodity prices and an industry decline in China-related trade finance volumes.
Asset quality remained healthy, the non-performing loan rate was unchanged from the previous quarter at 0.9 percent.
Allowance coverage of non-performing assets of 161 percent was around historical highs and was at 294 percent if collateral was considered.
DBS chief executive Piyush Gupta said, “DBS started the year on a solid footing, with strong all-round performance yet again.
“Despite a slowdown in trade volumes, the bank’s first-quarter earnings reached a record high. This is testament to the strength and resilience of the DBS franchise.
“We will continue to grow our business, while keeping a watchful eye on the economy.
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