FILE PHOTO: A logo of DBS is pictured outside an office in Singapore January 5, 2016. REUTERS/Edgar Su
February 14, 2022
By Anshuman Daga
SINGAPORE (Reuters) -DBS Group flagged strong business momentum after reporting a 37% rise in quarterly profit, boosted by improved asset quality at Southeast Asia’s largest bank as pandemic-hit economies bounce back.
Singapore lenders are expected to be big beneficiaries of rising interest rates while a rebound in economic growth and stable credit quality is also boosting the industry outlook.
“We look forward to the coming year with a prudently managed balance sheet that is poised to benefit from rising interest rates,” DBS CEO Piyush Gupta said in a statement on Monday, adding that the bank expects mid-to-single digit loan growth or better this year, after reporting a 9% increase last year.
DBS, the first Singapore bank to report this season, said net profit for October-December rose to S$1.389 billion ($1.03 billion) and follows a particularly weak pandemic-hit year when profit tumbled to a three-year low in the fourth quarter.
The result compares with an average estimate of S$1.47 billion from four analysts polled by Refinitiv.
Full year profit rose 44% to a record S$6.8 billion as a 9% growth in loans, the highest in seven years, and a surge in wealth management and transaction banking services fees offset the impact of lower interest rates.
DBS, which earns most of its profit from Singapore and Hong Kong, said allowances for loan losses decreased to S$33 million in the latest quarter from S$577 million a year earlier.
($1 = 1.3464 Singapore dollars)
(Reporting by Anshuman Daga; Editing by Edwina Gibbs and Diane Craft)
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