DBS to merge treasury markets, equity capital markets, brokerage and digital exchange

DBS on Friday (Feb 2) said it will merge its treasury markets business with equity capital markets, brokerage DBS Vickers and DBS Digital Exchange (DDEX).

The organisational changes come in tandem with the retirement of Eng-Kwok Seat Moey, DBS’ group head of capital markets, who is stepping down after 36 years with the bank.

The enlarged group will be renamed Global Financial Markets (GFM) from Mar 1. Treasury markets head Andrew Ng will oversee the enlarged group as head of GFM.

Ng, who has been with DBS since 2000, was appointed managing director and regional head of trading in 2005. He has led the bank’s treasury market expansion in the region since 2006, and expanded its capabilities in generic and exotic derivatives.

Glenn Thum, senior research analyst at Phillip Securities Research, noted that this is a “significant change” for DBS as the bank is now better positioned for growth, even as overall functions should still perform the same as they did before.

“This should be a positive merger for DBS, as it will have improved synergy due to the consolidation of the functions and improved efficiency by streamlining the operations,” he said.

Clifford Lee, DBS’ head of fixed income, will take on an expanded role as head of investment banking, comprising debt and equity markets, as well as DBS Vickers. He will continue to report to Ng.

Art Karoonyavanich, head of capital markets in Singapore, will take on a more regional role, while Kenneth Tang continues to be DBS Vickers’ group chief executive. Both report to Lee.

Thum noted that the Monetary Authority of Singapore in November 2023 restricted DBS’ activities, after repeated disruptions of the bank’s services in the past year. Among other things, DBS is not allowed to take on new business ventures during the six-month pause on non-essential IT changes.

“(The merger) is DBS’ way of growing internally, by moving existing functions around to gain more synergy,” he said.

The analyst added that the move was “necessary” for the bank to continue its innovation without having to acquire any new business ventures.

Thum expects the merger will likely improve earnings as the lender intends to grow this group more than when it was split up, although it may still be too early to tell.

Veteran banker Eng-Kwok, also known as the mother of real estate investment trusts (Reits), joined DBS in 1998, when the lender acquired POSB.

She took on the role as group head of capital markets in 2014 from Eric Ang, overseeing advisory and corporate finance, as well as the structuring and execution of all equity transactions including corporate equity fundraising and Reits.

She also oversees the securities business in Vickers Group, and is the founding chair of DDEX – a bank-backed digital exchange.

DBS chief executive Piyush Gupta said: “Seat’s retirement created an opportunity to merge various businesses, including equity capital markets and DBS Vickers, with treasury markets. I am confident that this merger will provide for greater synergy and enable us to more holistically meet our customers’ needs.”

Shares of DBS ended 1.2 per cent or S$0.39 higher at S$32.22 on Friday.