DBS says to wind down Islamic banking unit

[SINGAPORE] DBS Group Holdings, Singapore's biggest lender, said on Monday it would slowly wind down its Islamic banking unit as it failed to achieve economies of scale.

DBS said it would continue to develop and distribute Shariah compliant products such as Islamic bonds or Sukuk, within the bank's main operations.

It will also try to absorb the staff of the Islamic Bank of Asia (IB Asia), which was established in 2007 as a joint venture between DBS Bank and prominent investors based in the Gulf.

DBS CEO Piyush Gupta, who took over the top job in late 2009, has been focusing on the bank's core businesses to boost profitability by reducing the bank's non-core assets in recent years.

REUTERS