DBS reports first-half net profit of SGD 3.62 billion, return on equity at 13.3%.
ENPNewswire-August 8, 2022--DBS reports first-half net profit of SGD 3.62 billion, return on equity at 13.3%
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Release date- 06082022 - Second-quarter net profit up 7% to SGD 1.82 billion, second highest on record, on back of 17% increase in net interest income.
DBS Group achieved net profit of SGD 3.62 billion and return on equity of 13.3% for first-half 2022. Business momentum was broadly sustained in the first six months of the year while net interest margin rose after three years of decline. The gains were offset by lower wealth management fees due to weaker market conditions and a moderation in Treasury Markets income from the previous year's high. As a result, total income was little changed and net profit declined 3% from the record a year ago.
For the second quarter, net profit rose 7% from a year ago to SGD 1.82 billion, the second highest in history. Total income grew 6% to SGD 3.79 billion. Net interest income increased 17% boosted by an accelerated increase in net interest margin, more than offsetting an 11% decline in non-interest income due to weaker market conditions. Asset quality continued to be resilient with specific allowances at eight basis points of loans. Compared to the previous quarter, net profit rose 1%.
First-half performance
Net interest income increased 11% to SGD 4.64 billion from sustained loan growth and a higher net interest margin.
Loans grew 7% or SGD 26 billion in constant-currency terms from a year ago to SGD 425 billion. In the first half, loans grew 3% or SGD 14 billion as non-trade corporate loans rose SGD 8 billion and trade loans increased SGD 6 billion. Housing loans and wealth management loans were little changed.
Net interest margin was 1.52% compared to 1.47% a year ago. Net interest margin, which had been declining since 2019, rose in the first quarter with the start of interest rate hikes, and the improvement accelerated in the second quarter.
Net fee income fell 9% to SGD 1.66 billion. Wealth management fees declined 21% to SGD 745 million as weaker market conditions led to lower investment product sales. Investment banking fees were also lower by 36% to SGD 73 million as capital market activities slowed.
Other fee income activities continued to grow. Card fees rose 17% to SGD 390 million as overall spending reached a new high with travel spending continuing to recover to pre-pandemic levels. Loan-related fees increased 12% to SGD 258...
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