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DBS Q3 profits climb 15% to $ 1.6 billion, beat estimates, companies and markets

Mon, November 11, 2019 – 07:50 pm

Update Mon, 11.11.2019 – 9:47 pm

DBS Group's net profit for the third quarter jumped 15%, boosted by loan growth, record tax revenue and higher trading gains, it said on Monday.

Net profit for the three months ended September 30 was $ 1.63 billion, an increase of $ 1.41 billion for the previous period.

Year-to-date earnings per share was $ 2.50 per quarter, an increase of 15.7% from $ 2.16 a year ago.

Earnings for Southeast Asia's largest bank are higher than the projected consensus of $ 1.57 billion in a survey of five analysts by Rafiniti.

The lender declared a temporary single-rate, tax-free dividend of 30 cents in Singapore for the third quarter. It will be paid on November 29 after the books are closed on November 19.

Q3 net interest income rose 8% year-on-year to $ 2.46 billion from $ 2.27 billion, a 4% increase on permanent currency loans to $ 353 billion.

The net interest margin was up four basis points (BPS) by 1.9% for the quarter, up from 1.86% a year ago.

Net commission and commission income increased 17% to $ 814 million from broad-based growth. Wealth management fees increased 22% to $ 357 million from higher-end product sales, card fees rose 9% to $ 202 million from increased transactions across the region, and banking investment fees more than doubled to 55 million C as equity and equity debt increased market activities. Transaction fees rose 7% to $ 190m, both for cash management and trade finance.

Meanwhile, other non-interest income rose 35% to $ 549m for the quarter.

The bank's NPL ratio stood at 1.5%, a decrease of 1.6% for the same period a year ago.

However, the strong performance was moderated by additional general surpluses of $ 61m taken during Q3 as a prudent measure given current political and economic uncertainty, the DBS said. Specific add-ons were 193 million SE for the quarter, which was in line with recent quarter levels.

This resulted in total allowances rising 8% to $ 254m for Q3, and up 15% to $ 581m for the nine months ended September 30.

DBS chief executive Piyush Gupta said: "Our transformed franchise, moving performance and balance sheet strength will put us in a good position to deliver a healthy return to shareholders despite the prevailing macroeconomic and geopolitical heads."

Shares of the DBS traded up nine cents in Singapore, or 0.3 percent, at $ 26.52, at 9.35am on Monday, after the results were announced.

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