DBS Group posted a record quarterly net profit of S$3.08 billion for the second quarter, beating expectations as wealth management fees, treasury sales and trading income helped offset pressure from lower interest rates.
The Singapore-based lender said net profit rose 9% from S$2.82 billion a year earlier, surpassing the S$2.88 billion average estimate from three analysts polled by LSEG. The stronger performance prompted DBS to raise its full-year 2026 outlook.
DBS said total income for the year is now expected to exceed 2025 levels, while group net interest income is expected to close the gap with last year’s figure. It also raised its forecast for commercial-book non-interest income growth to the mid-teens, led by wealth management.
The bank’s wealth management franchise remained a key driver, with assets under management surpassing S$500 billion for the first time.
Net interest margin, meanwhile, narrowed to 1.87% from 2.05% a year earlier as lower interest rates put pressure on lending profitability. This was offset by stronger loan and deposit growth.
For the second quarter, DBS declared total dividends of S$0.81 per share, comprising S$0.66 in ordinary dividends and S$0.15 in capital return dividends. The estimated dividend payout is S$2.3 billion.
DBS expects interest rates to remain at current levels, with deposit growth in the high-single-digit range and its cost-income ratio staying in the low-40% range.
The bank expects specific provisions to remain within 17 to 20 basis points of loans in the second half, while its general-provision reserves are expected to provide a buffer against potential risks.
DBS CEO Tan Su Shan said the bank had delivered a strong first-half performance, supported by its wealth management business, while remaining resilient despite the challenging interest-rate environment.
DBS’ return on equity rose to 17.9% from 16.7% a year earlier.
The results mark the start of the second-quarter earnings season for Singapore’s major banks. Oversea-Chinese Banking Corp and United Overseas Bank are due to report their results on Friday, with investors watching whether wealth management, transaction banking and markets income can continue to offset pressure on lending margins.
Reuters
