DBS 3Q09 Results Flash

Net profit of S$552m in 2Q09 (+27% qoq) was above our forecast of S$355m. Net interest income of S$1,112m (+5% yoy) was in line with our expectations. Net interest margin was marginally higher at 2.01% compared to 1.99% in 1Q09. Loans contracted by 1.8% qoq to S$130.4b in line with industry trend.

Fees & commissions were S$358m, up 13% qoq, with strong contributions from stockbroking (+79% qoq), investment banking (+59% qoq) and wealth management (+31% qoq).

Net trading income was a whopping S$234m due to foreign exchange and interest rate activities. DBS also recognised investment gains of S$138m from sale of equity holdings.

Staff cost and other expenses was well under control. Cost/income ratio improved from 38.4% in 1Q09 to 35.2% in 2Q09.

NPL ratio increased from 2.0% in 1Q09 to 2.8%% in 2Q09. The bulk of NPLs came from the "others" category, likely to be a financial institution and currently labeled under the substandard category. Management explained that the increase was from shipping and Middle East corporates and institutions.

Specific provision was S$272m and general provision was S$183m, totalling 138bp on an annualised basis. NPL coverage is 81%. Tier-1 CAR maintain at 12.6%.

DBS declared dividend of 14 cents, unchanged compared to the last quarter.

Sponsored Links

Related Posts by Categories