DBS Group (D05) Q2 2024 earnings summary

Executive summary

• First-half 2024 net profit reached a record $5.76 billion, up 9% year-over-year, with total income rising 11% to $11.0 billion, driven by broad-based growth in net interest, fee, and treasury customer sales income.

• Second-quarter net profit was $2.80 billion, up 4% year-over-year, with return on equity at 18.2% and total income up 9% to $5.48 billion.

• Resilience maintained amid market volatility and geopolitical tensions, with strong capital and liquidity positions.

• Interim dividend of 54 cents per share declared for 2Q24, totaling an estimated $1,536 million.

Financial highlights

• Net interest income for 1H24 rose 6% year-over-year to $7.10 billion, with commercial book NIM up 5 bps to 2.80%.

• Net fee and commission income increased 25% to $2.09 billion, led by strong growth in wealth management and card fees.

• Other non-interest income rose 15% to $1.85 billion, with net trading income up 21%.

• Expenses increased 11-12% year-over-year, with Citi Taiwan accounting for five percentage points of the increase; cost-to-income ratio was 39% for 1H24 and 40% for Q2.

• Allowances for credit and other losses were $283 million for 1H24, up 21% year-over-year but down 21% from the previous half.

Outlook and guidance

• High single-digit total income growth expected for the year, factoring in a couple of rate cuts.

• Asset quality expected to remain resilient, with NPL ratio stable at 1.1%.

• Liquidity and capital ratios remain well above regulatory requirements, supporting continued growth.

• Allowances guidance revised to 10-15 basis points, with net profit growth expected in the mid- to high single digits for the year.

• Book is more resilient to interest rate cuts, with sensitivity reduced to $4 million per basis point.