DBS : D05 0% reported net profit of S$2.59 billion for the third quarter ended September, 16 per cent higher than earnings of S$2.24 billion in the corresponding period last year.

This includes one-off costs of S$40 million accrued from the acquisition of Citigroup’s Taiwan consumer banking business in Q3.

Notwithstanding this one-off item, Q3 net profit would have been up 18 per cent to S$2.63 billion, driven by a record-high total income, said the largest bank in Singapore on Monday (Nov 6).

This figure beat a S$2.54 billion consensus forecast in a Bloomberg survey of four analysts.

The results translate to a higher earnings per share of S$4, compared with S$3.41 in the year-ago period.

Total income for the third quarter stood at a record high of S$5.2 billion, 16 per cent higher on the year. 

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The record income was due to continued improvement in net interest margin and sustained growth in commercial book non-interest income, noted DBS chief executive officer Piyush Gupta.

Total net interest income, including treasury markets, was up about 16 per cent to S$3.5 billion, compared with S$3 billion in the previous Q3.

In particular, net interest income under the commercial book rose 23 per cent.

Excluding the one-time item, net interest margin (NIM) at the group level stood at 2.19 per cent, up from 1.9 per cent in Q3 last year. At the commercial book level and excluding treasury markets trading income, NIM expanded 52 basis points from a year earlier to 2.82 per cent from further increases in interest rates.

Other non-interest income rose 20.7 per cent from a year earlier and the previous quarter to S$845 million from higher treasury customer sales and higher treasury markets non-interest income.

At the commercial book level, net fee and commission income grew 9 per cent to S$843 million for the quarter.

Allowances stood at S$215 million, 21 per cent higher on the year, with S$18 million in general allowances and S$197 million in specific allowances taken.

The non-performing loan ratio was little changed at 1.2 per cent.

“As we enter the coming year, higher-for-longer interest rates will be a net benefit to earnings, while our solid balance sheet with ample liquidity, prudent general allowance reserves and healthy capital ratios will provide us with strong buffers against macro uncertainties,” said Gupta.

The lender declared a dividend of S$0.48 per share for the period, up from the S$0.36 in the previous Q3. This brings the total dividend for the three quarters ended Sep 30 to S$1.38 per share. In contrast to DBS’s performance, UOB reported on Oct 26 net profit of S$1.38 billion for the third quarter ended September, down 1 per cent from S$1.4 billion in Q3 FY2022, after accounting for one-off expenses related to the acquisition of Citigroup’s Malaysia, Thailand and Vietnam consumer banking business.

DBS’ shares closed up 1.9 per cent, or S$0.63, at S$33.29 on Friday.