- DBS (SGX:D05)’s 4Q25 adjusted earnings of S$2.4bn were slightly below our estimates, at 95% of our FY25e forecast.
- 4Q25 DBS's dividends raised 35% y-o-y to 81 cents (comprising 66 cents ordinary dividend and 15 cents capital return dividend), total FY25 DBS's dividends of S$3.06 (+38% y-o-y).
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- DBS maintained its FY26e guidance for NII to be slightly below 2025 levels, non-interest income growth in the high single digits, credit costs to normalize at 17-20bps, and PATMI below 2025 levels from the lower interest rate environment. Capital return dividend (60cents/share per year) until FY27 and step up of 6cents/share per quarter until 3Q26 policy has been maintained.
The Positive
Pivoting towards fee income.
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- Furthermore, investment banking fees surged by 45% y-o-y from increased debt and equity capital market activity, indicating a revival in capital market sentiment, and would further diversify DBS’ earnings drivers beyond pure interest rate sensitivity. Total net fee income rose 14% y-o-y, helping to offset the decline in NII.
The Negatives
NII and NIMs hurt from lower rates.
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