ASEAN KEY DESTINATIONS
DBS Q2 net profit rises 15%, sees some uncertainty in H2
SINGAPORE: DBS Group Holdings, Singapore's biggest bank, on Monday (Jul 27) posted a better-than-expected 15 per cent rise in second-quarter net profit, helped by higher interest rate margins, but warned of some uncertainty in the second half.
And improving interest margin and healthy loan growth have helped South-East Asia's biggest lender withstand a slowing economy, a weak property market and sluggish China-related trade finance business.
DBS cautioned there was some uncertainty in its second-half outlook, but said its loan and business pipelines remain healthy.
"Despite slowing growth across the region, DBS achieved record earnings in the first half of the year driven by strong broad-based income growth," CEO Piyush Gupta said in a statement.
The bank increased its first-half dividend to 30 cents a share from 28 cents a year ago.
Net profit rose to S$1.117 billion for the April to June period, from S$969 million in the same period a year earlier. The result was above an average forecast of S$1.06 billion from seven analysts polled by Reuters.
First half net profit hit a record S$2.386 billion.
Net interest income rose 12 per cent to S$1.74 billion, fuelled by an eight basis point increase in net interest margin to 1.75 per cent, while trading income surged 55 per cent.
DBS said its interest rate margin was the highest in 13 quarters as more Singapore dollar loans were re-priced in line with a recent rise in interbank and swap offer rates.
Moody's Investors Service earlier this month revised its outlook for Singapore banks to stable from negative, reflecting the domestic property market's soft landing, and moderating domestic and cross-border credit growth.
Data last week showed prices of private homes in Singapore fell for a seventh straight quarter, the longest declining streak in more than a decade.
Shares of DBS have risen nearly 3.9 per cent so far this year, beating the weak stock performance of its two domestic rivals Oversea-Chinese Banking Corp and United Overseas Bank.
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