DBS GROUP HOLDINGS LTD
D05.SI
DBS - Sequentially Flat NIM
- DBS’ 2Q17 results (announced this morning) were in line with expectations. 1H17 core net profit was up 4% YoY. The positives include relatively stable asset quality (NPL ratio only up marginally to 1.5%), sequential loan expansion of 1.5%, and higher interim dividend of SGD0.33/share.
- The negatives include a sequentially flat NIM (unlike the widening NIMs recorded by its two peers).
- We will review our earnings forecasts and TP after the analyst briefing to be held later today.
DBS released its 2Q17 results this morning.
- Highlights for 2Q17:
- 2Q17 net profit was SGD1,130m. Excluding one-time items, 2Q17 net profit of SGD1,140m was down 6% QoQ. 1H17 net profit of SGD2,375m represented 53%/50% of ours and consensus 2017 net profit forecasts respectively. We rate the results as in line;
- 2Q17 net interest margin (NIM) of 1.74% was unchanged QoQ, and 13bps narrower YoY. The YoY decline was due to softer SGD interest rates; i
- 2Q17 credit cost (specific loan allowances) of 40bps was higher than 1Q17’s 26bps;
- 2Q17 loan loss coverage was 100%, vs 1Q17’s 103%;
- 2Q17 loans were 1.5% higher QoQ, with strength from the manufacturing and building & construction sectors. Loans were up 6.4% YoY;
- The Board declared 1H17 dividend of SGD0.33 per share, up 10% from the recent half-yearly payout. The scrip dividend will apply.
- More highlights after the analyst briefing to be held later today.
Leng Seng Choon CFA
RHB Invest
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http://www.rhbinvest.com.sg/
2017-08-04
RHB Invest
SGX Stock
Analyst Report
20.500
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