DBS broadly keeping its 2025 guidance, albeit with some tweaks due to the uncertainties ahead. Positively, while the impact from US tariff policies are still uncertain, DBS does not think it would derail its capital returns and dividend commitments – our key thesis for the stock.
1Q25 results were in line.
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As expected, an interim DBS's dividends of 60 cents (1Q24: S$0.54) and a capital return dividend of 15 cents were declared.
Results highlights.
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PIOP rose by a decent 6% y-o-y (+23% q-o-q) from a stronger NII at +5% y-o-y (-1% q-o-q) and non-II at +8% y-o-y (+25% q-o-q), while CIR was stable y-o-y at 37.5% (4Q24: 45.3%). NIM held up well at 2.12% (-3bps q-o-q/-2bps y-o-y) while annualised loans and deposits growth stood at +5%/+10%. \
Fee income jumped 22% y-o-y (+32% q-o-q), led by wealth management and loan-related fees. These, however, were partly offset by higher total credit cost of 30bps (1Q24: 13bps; 4Q24: 19bps), and while the specific provision (SP) charge of 10bps was below the 17-20bps guidance, DBS set aside S$205m in general provisions (GP) to build up provision buffers on macroeconomic and geopolitical uncertainties. This was despite NPA falling 3% q-o-q due to lower new NPA formation and higher upgrades, while NPL ratio was stable at 1.1%.
Briefing highlights.
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