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Singapore's DBS posts 6 pct drop in Q2 net profit

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by August 8, 2016 General

SINGAPORE, Aug. 8 (Xinhua) — Singapore’s biggest bank DBS Group Holdings posted a 6 percent drop in its net profit for the second quarter of 2016, the bank announced on Monday.

DBS’s net profit for second quarter came in 1.05 billion Singapore dollars (779.1 million U.S. dollars), which was 6 percent lower compared to a year ago due to the net allowance charge. While the total income rose 8 percent to a new quarterly high of 2.92 billion Singapore dollars (2.17 billion U.S. dollars), exceeding cost growth of 6 percent.

The bank revealed that the 10 percent increase in profit before allowances was more than offset by higher allowances in the second quarter. Total allowances more than doubled to 366 million Singapore dollars (271.6 million U.S. dollars) as a result of the net allowances of 150 million Singapore dollars (111.3 million U.S. dollars) for Swiber.

As for the first half of 2016, DBS achieved net profit of 2.25 billion Singapore dollars (1.67 billion U.S. dollars). Excluding one-time items a year ago, net profit was slightly higher and a record. Total income increased 6 percent to a new high of 5.78 billion Singapore dollars (4.29 billion U.S. dollars). The bank said the rise was achieved through diversified growth, with net interest margin at a six-year high and record fee income.

DBS CEO Piyush Gupta said the bank’s first-half earnings were at a record despite an unexpected significant allowance charge. The performance demonstrates DBS’s ability to consistently capture opportunities across our businesses and effectively manage costs.

“While there remains some uncertainty in the second half, our business momentum is good and our balance sheet healthy. We are well prepared to meet the challenges ahead,” said Piyush Gupta.

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