Dbs Group Holdings Ltd · SGX:D05
Dbs — Q3 2020 Earnings Presentation
16 slides from Dbs's earnings presentation, Nov 5, 2020
Slide 1: 3Q results reflect improving business momentum
3Q results reflect improving business momentum DBS Group Holdings 3Q 2020 financial results November 5, 2020 Disclaimer: The information contained in this document is intended only for use during the presentation and should not be disseminated or distributed to parties outside the presentation. DBS
Slide 2: Highlights
Highlights 3Q net profit up 4% on quarter to $1.30bn as business momentum recovers ▪ Net interest income declines 6% due to 9bp fall in net interest margin, underlying loan growth healthy ▪ Fee income rebounds 17% to pre-Covid levels, third-highest on record ▪ Total income declines 4% due partly to
Slide 3: 3Q net profit up 4% on quarter as fee income rebounds 17%
3Q net profit up 4% on quarter as fee income rebounds 17% (S$m) 3Q20 QoQ % ▪ Net interest income down 6% as impact of interest rate cuts in 1H is felt more fully Total income 3,577 (4) ▪ Fee income up 17% led by wealth management Expenses 1,539 4 and card fees Profit before allowances 2,038 (9) ▪ Tr
Slide 4: Record 9M operating profit enables conservative GP of $1.50bn
Record 9M operating profit enables conservative GP of $1.50bn (S$m) 9M20 YoY % ▪ Net interest income down 3% as NIM declines 23bp to offset 5% loan growth Total income record 11,329 2 ▪ Fee income flat as 3Q rebound offsets weak 2Q Expenses 4,578 (2) ▪ Other income up 31% as investment gains triple
Slide 5: Net interest income down 6% on quarter as NIM tightens 9bp
Net interest income down 6% on quarter as NIM tightens 9bp Net interest margin (%) 2.17 2.07 Excluding TM 1.80 1.73 1.62 Group 1.90 1.67 1.86 1.62 1.53 Net interest 7,199 6,956 income (S$m) 2,482 2,303 2,171 9M19 9M20 1Q20 2Q20 3Q20 5
Slide 6: Loans up 3% over 9M, stable on quarter
Loans up 3% over 9M, stable on quarter Others (S$bn) 378 ▪ Loans up $11 billion or 3% year to date, stable on CBG / 112 quarter in constant WM currency terms +18 ▪ 3Q non-trade corporate +10 +10 loan drawdowns offset by +11 +9 repayments of short-term Other +3 facilities 222 + IBG ▪ Singapore housin
Slide 7: Deposits up 1% on quarter, 9% over 9M on $70bn Casa inflows
Deposits up 1% on quarter, 9% over 9M on $70bn Casa inflows 498 493 (S$bn) 461 50 46 57 Loans 151 136 Other funding 166 FD and others Casa 358 375 371 296 310 238 Dec-19 Jun-20 Sep-20 HQLA (S$bn) 92 108 107 Ratios (%) LDR 89 84 83 LCR 135 134 135 NSFR 110 121 123 HQLA is high quality liquid assets;
Slide 8: 3Q net fee income rebounds 17% on quarter to pre-Covid levels
3Q net fee income rebounds 17% on quarter to pre-Covid levels, third highest on record (S$m) 2,698 2,661 Brokerage 89 112 133 104 962 Investment 913 banking 37 36 38 786 41 Wealth 1,004 management 1,087 37 27 402 380 305 Loan-related 323 337 126 111 589 100 Cards 464 173 131 160 Transaction services
Slide 9: 9M expenses decline 2%, cost-income ratio at 40%
9M expenses decline 2%, cost-income ratio at 40% 42 43 Cost / income 40 40 39 (%) (S$m) 4,658 4,578 1,556 1,483 1,539 Staff 2,599 2,655 expenses 882 872 901 Other 2,059 1,923 674 expenses 611 638 9M19 9M20 1Q20 2Q20 3Q20 9
Slide 10: NPL ratio in line with recent quarters, bulk of new NPA formation in 1Q
NPL ratio in line with recent quarters, bulk of new NPA formation in 1Q (S$m) 9M19 9M20 1Q20 2Q20 3Q20 NPAs at start of period 5,684 5,773 5,773 6,592 6,354 IBG and others 167 655 620 (201) 236 New NPAs 724 1,551 1,023 115 543 Upgrades, settlements and recoveries (286) (489) (340) (201) (78) Write-o
Slide 11: 3Q SP at 31bp of loans in line with 1H
3Q SP at 31bp of loans in line with 1H (S$m) 9M19 9M20 1Q20 2Q20 3Q20 IBG and others 369 592 257 146 189 Add charges for 416 723 359 165 212 New NPLs 184 550 315 16 161 Existing NPLs 232 173 44 149 51 Subtract charges for 47 131 102 19 23 Upgrades 1 1 0 0 0 Settlements 31 116 100 15 14 Recoveries 15
Slide 12: GP reserves rise 60% over 9M to $4.02bn
GP reserves rise 60% over 9M to $4.02bn 6,986 Conservative GP reserves 6,721 ▪ Balance sheet (S$m) conservatively fortified 5,417 against risks arising from RLAR 404 3,799 4,017 the Covid-19 pandemic GP 2,511 ▪ GP reserves raised $1.2bn beyond Tier-2 eligibility, providing future store of CET-1 to b
Slide 13: Strong CET-1 and leverage ratios
Strong CET-1 and leverage ratios (%) 16.7 16.8 16.6 Tier 2 1.7 1.7 1.7 Additional Tier 1 0.9 1.2 1.2 Common Equity Tier 1 14.1 13.7 13.9 Dec-19 Jun-20 Sep-20 RWA (S$bn) 304 323 321 Leverage ratio (%) 7.0 6.8 6.9 13
Slide 14: 3Q dividend at 18 cents per share
3Q dividend at 18 cents per share (S¢ per share) 33 Final 60 30 18 3Q 30 18 2Q Interim 60 30 33 1Q 2018 2019 2020 14
Slide 15: In summary – 3Q results reflect improving business momentum
In summary – 3Q results reflect improving business momentum 3Q business momentum recovers to mitigate the impact of low interest rates as regional economies emerge from lockdowns We will remain vigilant around expenses and leverage digitalisation for efficiency Total allowances of $2.49bn taken over
Slide 16: 3Q results reflect improving business momentum
3Q results reflect improving business momentum DBS Group Holdings 3Q 2020 financial results November 5, 2020 Disclaimer: The information contained in this document is intended only for use during the presentation and should not be disseminated or distributed to parties outside the presentation. DBS