DBS Group (D05) Q4 2024 earnings summary

Executive summary

• Achieved record net profit of SGD 11.4 billion for 2024, up 11% year-over-year, with ROE sustained at 18%, among the highest for developed market banks.

• Fourth quarter net profit was SGD 2.62 billion, up 10% year-over-year, capping a record year for income and earnings.

• Total income rose 10% to SGD 22.3 billion, driven by broad-based growth across business lines, with strong momentum in wealth management and treasury customer sales.

• Wealth management and treasury customer sales reached new highs, with net fee income surpassing SGD 4 billion for the first time.

• Balance sheet remains healthy, supported by prudent risk management and digital transformation initiatives.

Financial highlights

• Net interest income grew 5% to SGD 15.0 billion, supported by a 4 bps expansion in net interest margin to 2.80% and balance sheet growth.

• Net fee income rose 23% to SGD 4.17 billion, led by a 45% increase in wealth management fees.

• Markets trading income rebounded 27% to SGD 922 million, benefiting from market volatility.

• Expenses increased 10% to SGD 8.9 billion, with Citi Taiwan contributing 3 percentage points; cost-to-income ratio remained stable at 40%.

• Allowances for credit and other losses at SGD 622 million for the year, with specific allowances at 13 bps and allowance coverage at 229%.

Outlook and guidance

• 2025 guidance assumes two US rate cuts in the second half, with group NIM expected to fall slightly to around 2.10%.

• Loan growth projected at mid-single digits, mainly in the corporate non-trading book.

• Commercial book non-interest income growth expected in high single digits, supported by continued wealth management momentum.

• Cost-to-income ratio targeted in the low 40% range; pretax profit to be around 2024 levels, but net profit for 2025 expected to be below 2024 due to the new BEPS minimum tax rate, reducing net profit by about SGD 400 million.

• Board plans to return excess capital via a new capital return dividend of SGD 0.15 per share per quarter for 2025, with flexibility for future years.