2Q11 presentation slides
Sustained customer income
underpins performance
DBS Group Holdings
2Q 2011 financial results
July 28, 2011
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 Bank accepts no liability whatsoever with respect to the use of this document or its contents.
Sustained customer income underpins
performance
T
Positive operating trends underpinned by customer income
growth
T
Improvements in Hong Kong’s operating performance
T
Balance sheet remains strong
2
1H earnings up 23% on year to record $1.54 billion
(S$m)
1H
2011
1H
2010
YoY
%
2H
2010
HoH
%
Net interest income
2,321
2,133
9
2,185
6
Fee income
803
699
15
698
15
Trading income
404
508
(20)
387
4
Other income
219
188
16
268
(18)
Non-interest income
1,426
1,395
2
1,353
5
Total income
3,747
3,528
6
3,538
6
Staff expenses
828
700
18
722
15
Other expenses
743
719
3
784
(5)
Expenses
1,571
1,419
11
1,506
4
Profit before allowances
2,176
2,109
3
2,032
7
262
559
(53)
352
(26)
1,542
1,250
23
1,400
10
Allowances
Net profit
Excluding one-time items
3
2Q net interest income and customer non-interest
income higher on year
(S$m)
2Q
2011
2Q
2010
YoY
%
1Q
2011
QoQ
%
Net interest income
1,199
1,067
12
1,122
7
Fee income
387
358
8
416
(7)
Trading income
146
278
(47)
258
(43)
Other income
106
112
(5)
113
(6)
Non-interest income
639
748
(15)
787
(19)
1,838
1,815
1
1,909
(4)
Staff expenses
423
362
17
405
4
Other expenses
375
355
6
368
2
Expenses
798
717
11
773
3
1,040
1,098
(5)
1,136
(8)
Allowances
137
204
(33)
125
10
Net profit
735
718
2
807
(9)
Total income
Profit before allowances
Excluding one-time items
4
1H ROE improves to 11.4%
2Q
2011
2Q
2010
1Q
2011
1H
2011
1H
2010
2H
2010
1.80
1.84
1.80
1.80
1.88
1.80
Fee income/total income
21
20
22
21
20
20
Non-interest income/total
income
35
41
41
38
40
38
Cost/income
43
40
40
42
40
43
10.6
11.1
12.1
11.4
9.8
10.6
80
79
79
80
79
79
7
19
9
8
56
29
1.5
2.3
1.8
1.5
2.3
1.9
(%)
Net interest margin
ROE
Loans/deposits
SP/average loans (bp)
NPL ratio
5
Net interest income up 12% on year to record
(S$m)
4,301
2.04
2008
Net Interest Margin (%)
4,455
2.02
2009
4,318
1.84
2010
1.93
1.84
1.80
1.79
1.80
1.80
1,066
1,067
1,079
1,106
1,122
1,199
1Q
2Q
3Q
4Q
1Q
2Q
2010
2011
6
Loans up 11% year to date, LDR rises slightly to
80%
Loans
(S$bn)
Deposits
211
200
194
183
170
169
157
152
131
126
Dec 08
Loans/deposits (%)
74
Dec 09
71
Dec 10
79
Mar 11
79
Jun 11
80
7
Fee income up 8% on year
(S$m)
Non-interest income / total income (%)
39
Fee income
41
41
40
38
Trading + other income
36
35
33
2,748
29
2,148
1,397
1,730
1,394
1,274
1,351
456
2008
754
2009
2010
787
647
341
306
748
358
390
730
340
390
623
358
265
416
371
639
387
252
1Q
2Q
3Q
4Q
1Q
2Q
2010
2011
8
1H Treasury customer income up 42% on year
(S$m)
1H
2011
1H
2010
YoY
%
2H
2010
HoH
%
Customer income
433
306
42
381
14
Other income, principally
from balance sheet
management, market-making
and warehousing
537
731
(27)
502
7
Total Treasury income
970
1,037
(6)
883
10
45
30
15pt
43
2pt
Customer income as % of
total Treasury income
9
Wealth management fees up 53% on year
Regional sales volume (S$m)
Unit Trust
1,552
Bancassurance
1,465
1,303
1,033
778
1,016
850
921
990
630
585
592
193
258
1Q
2Q
403
3Q
536
544
313
4Q
1Q
2010
Fees (unit trusts &
bancassurance only)
27
34
2Q
2011
31
44
51
52
Excluding other wealth management products such as structured deposits
10
Continued investments to support higher
business volumes and build capacity for growth
(S$m)
Cost / income (%)
Staff expense
Other expense
45
43
39
41
43
41
40
40
702
338
364
717
362
355
726
360
366
780
362
773
405
423
418
368
375
1Q
2Q
3Q
4Q
1Q
2Q
40
2,925
2,610
1,256
1,354
2008
2,604
1,422
1,292
1,312
2009
1,503
2010
2010
798
2011
11
Sustained customer income underpins
performance
T
Positive operating trends underpinned by customer-related
income growth
T
Improvements in Hong Kong’s operating performance
T
Balance sheet remains strong
12
Hong Kong’s 1H earnings up 51% on year in
constant currency terms
Constant currency terms
1H
2011
1H
2010
YoY
%
YoY
%
2H
2010
HoH
%
HoH
%
Net interest income
389
400
(3)
9
383
2
7
Non-interest income
377
330
14
27
352
7
14
Total income
766
730
5
17
735
4
11
Expenses
309
396
(22)
(13)
324
(5)
1
Profit before
allowances
457
334
37
53
411
11
18
Allowances
63
39
62
84
34
85
94
333
245
36
51
334
(0)
5
(S$m)
Net profit
Figures for Hong Kong geographical basis and converted to S$ using monthly closing rates
Based on Singapore GAAP
13
Hong Kong’s 2Q earnings rise on year as
operating trends improve
Constant currency terms
(S$m)
2Q
2011
2Q
2010
YoY
%
YoY
%
1Q
2011
QoQ
%
QoQ
%
Net interest income
199
198
1
13
190
5
8
Non-interest income
177
165
7
21
200
(12)
(8)
Total income
376
363
4
17
390
(4)
(0)
Expenses
154
249
(38)
(30)
155
(1)
2
Profit before
allowances
222
114
95
>100
235
(6)
(2)
Allowances
54
32
69
90
9
>100
>100
143
65
>100
>100
190
(25)
(22)
Net profit
Figures for Hong Kong geographical basis and converted to S$ using monthly closing rates
Based on Singapore GAAP
14
Hong Kong’s 1H ROA improves on year
2Q
2011
2Q
2010
1Q
2011
1H
2011
1H
2010
2H
2010
1.52
1.68
1.48
1.50
1.73
1.53
Non-interest income/total
income
47
46
51
49
45
48
Cost/income
41
69
40
40
54
44
ROA
0.99
0.64
1.33
1.16
0.93
1.15
Loans/deposits
107
104
103
107
104
99
(%)
Net interest margin
15
Contributions from regional operations improve
(S$m)
1H
2011
1H
2010
YoY
%
2H
2010
HoH
%
Net interest income
504
433
16
419
20
Non-interest income
189
183
3
140
35
Total income
693
616
13
559
24
Expenses
321
281
14
313
3
Profit before allowances
372
335
11
246
51
25
94
(73)
92
(73)
308
218
41
165
87
Allowances
Net profit
Figures for operations outside of Singapore and Hong Kong
16
Sustained customer income underpins
performance
T
Positive operating trends underpinned by customer-related
income growth
T
Improvements in Hong Kong’s operating performance
T
Balance sheet remains strong
17
NPL ratio improves from customer repayments
and loan upgrading
NPA (S$m)
NPL Ratio (%)
Not overdue
90 days overdue
2.9
2.7
2.3
1.9
2.1
1.9
1.5
1.5
4,219
43%
2,392
36%
19%
8%
SP/loans (bp)
4,068
3,213
40%
3,724
41%
26%
7%
21%
7%
3,505
38%
6%
3,213
3,098
40%
38%
7%
11%
2,883
55%
52%
53%
57%
53%
51%
8%
37%
2010
1Q
2Q
3Q
4Q
1Q
2Q
43
97
19
33
25
9
7
49%
53%
2008
2009
35
85
45%
1.8
Cumulative general and specific allowances as % of:
NPAs
114
83
100
92
101
97
100
103
113
Unsecured NPAs
176
108
127
119
126
124
127
134
148
18
New NPAs remain low
(S$m)
NPAs at start of period
New NPAs
Net recoveries of existing NPAS
Write-offs
NPAs at end of period
2Q
2011
1Q
2011
2Q
2010
3,098
3,213
4,068
91
108
115
(266)
(111)
(268)
(40)
(112)
(191)
2,883
3,098
3,724
19
Specific allowances decline
2Q
2011
1Q
2011
2Q
2010
New NPLs
44
20
29
Existing NPLs
56
70
104
100
90
133
4
0
0
Settlements
38
43
54
Recoveries
31
13
11
73
56
65
27
34
68
7
9
19
(S$m)
Add charges for
Substract charges for
Upgrading
Total SP charges
SP / average loans (bp)
20
AFS portfolio well-balanced between investmentgrade government and corporate debt
(S$m)
Jun
2011
Mar
2011
Singapore government securities
11,371
10,308
8,530
8,061
10,524
10,261
1,023
1,104
31,448
29,734
Other government securities
Corporate debt securities
Equities
Total
21
Capital ratios remain strong
(%)
18.4
16.7
17.1
3.6
16.5
16.3
3.7
3.4
3.2
13.1
13.4
13.1
13.1
Dec 08
Dec 09
Mar 10
Jun 10
Core Tier 1 (%)
8.0
11.0
11.3
RWA (S$bn)
183
177
176
14.0
Tier 2
Tier 1
17.2
3.3
3.0
16.5
3.0
3.9
15.1
14.2
13.5
Sep 10
Dec 10
Mar 11
Jun 11
11.1
11.2
11.8
11.5
11.5
185
187
183
190
198
10.1
22
Interim dividend of 28 cents per share
(S¢)
Special (gross)
68
63
4
17
Quarterly (gross)
Quarterly (one-tier)
Half-yearly (one-tier)
65
14
17
56
56
14
17
17
14
28
14
28
17
17
14
14
14
28
14
17
17
14
14
2006
2007
2008
2009
2010
2011
23
In summary – sustained customer income
underpins performance
First-half results underscore momentum in implementing
strategic initiatives
Will remain focused on execution to take advantage of growth
opportunities
Well-positioned to weather near-term uncertainties
24
Sustained customer income
underpins performance
DBS Group Holdings
2Q 2011 financial results
July 28, 2011
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 Bank accepts no liability whatsoever with respect to the use of this document or its contents.
underpins performance
DBS Group Holdings
2Q 2011 financial results
July 28, 2011
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 Bank accepts no liability whatsoever with respect to the use of this document or its contents.
Sustained customer income underpins
performance
T
Positive operating trends underpinned by customer income
growth
T
Improvements in Hong Kong’s operating performance
T
Balance sheet remains strong
2
1H earnings up 23% on year to record $1.54 billion
(S$m)
1H
2011
1H
2010
YoY
%
2H
2010
HoH
%
Net interest income
2,321
2,133
9
2,185
6
Fee income
803
699
15
698
15
Trading income
404
508
(20)
387
4
Other income
219
188
16
268
(18)
Non-interest income
1,426
1,395
2
1,353
5
Total income
3,747
3,528
6
3,538
6
Staff expenses
828
700
18
722
15
Other expenses
743
719
3
784
(5)
Expenses
1,571
1,419
11
1,506
4
Profit before allowances
2,176
2,109
3
2,032
7
262
559
(53)
352
(26)
1,542
1,250
23
1,400
10
Allowances
Net profit
Excluding one-time items
3
2Q net interest income and customer non-interest
income higher on year
(S$m)
2Q
2011
2Q
2010
YoY
%
1Q
2011
QoQ
%
Net interest income
1,199
1,067
12
1,122
7
Fee income
387
358
8
416
(7)
Trading income
146
278
(47)
258
(43)
Other income
106
112
(5)
113
(6)
Non-interest income
639
748
(15)
787
(19)
1,838
1,815
1
1,909
(4)
Staff expenses
423
362
17
405
4
Other expenses
375
355
6
368
2
Expenses
798
717
11
773
3
1,040
1,098
(5)
1,136
(8)
Allowances
137
204
(33)
125
10
Net profit
735
718
2
807
(9)
Total income
Profit before allowances
Excluding one-time items
4
1H ROE improves to 11.4%
2Q
2011
2Q
2010
1Q
2011
1H
2011
1H
2010
2H
2010
1.80
1.84
1.80
1.80
1.88
1.80
Fee income/total income
21
20
22
21
20
20
Non-interest income/total
income
35
41
41
38
40
38
Cost/income
43
40
40
42
40
43
10.6
11.1
12.1
11.4
9.8
10.6
80
79
79
80
79
79
7
19
9
8
56
29
1.5
2.3
1.8
1.5
2.3
1.9
(%)
Net interest margin
ROE
Loans/deposits
SP/average loans (bp)
NPL ratio
5
Net interest income up 12% on year to record
(S$m)
4,301
2.04
2008
Net Interest Margin (%)
4,455
2.02
2009
4,318
1.84
2010
1.93
1.84
1.80
1.79
1.80
1.80
1,066
1,067
1,079
1,106
1,122
1,199
1Q
2Q
3Q
4Q
1Q
2Q
2010
2011
6
Loans up 11% year to date, LDR rises slightly to
80%
Loans
(S$bn)
Deposits
211
200
194
183
170
169
157
152
131
126
Dec 08
Loans/deposits (%)
74
Dec 09
71
Dec 10
79
Mar 11
79
Jun 11
80
7
Fee income up 8% on year
(S$m)
Non-interest income / total income (%)
39
Fee income
41
41
40
38
Trading + other income
36
35
33
2,748
29
2,148
1,397
1,730
1,394
1,274
1,351
456
2008
754
2009
2010
787
647
341
306
748
358
390
730
340
390
623
358
265
416
371
639
387
252
1Q
2Q
3Q
4Q
1Q
2Q
2010
2011
8
1H Treasury customer income up 42% on year
(S$m)
1H
2011
1H
2010
YoY
%
2H
2010
HoH
%
Customer income
433
306
42
381
14
Other income, principally
from balance sheet
management, market-making
and warehousing
537
731
(27)
502
7
Total Treasury income
970
1,037
(6)
883
10
45
30
15pt
43
2pt
Customer income as % of
total Treasury income
9
Wealth management fees up 53% on year
Regional sales volume (S$m)
Unit Trust
1,552
Bancassurance
1,465
1,303
1,033
778
1,016
850
921
990
630
585
592
193
258
1Q
2Q
403
3Q
536
544
313
4Q
1Q
2010
Fees (unit trusts &
bancassurance only)
27
34
2Q
2011
31
44
51
52
Excluding other wealth management products such as structured deposits
10
Continued investments to support higher
business volumes and build capacity for growth
(S$m)
Cost / income (%)
Staff expense
Other expense
45
43
39
41
43
41
40
40
702
338
364
717
362
355
726
360
366
780
362
773
405
423
418
368
375
1Q
2Q
3Q
4Q
1Q
2Q
40
2,925
2,610
1,256
1,354
2008
2,604
1,422
1,292
1,312
2009
1,503
2010
2010
798
2011
11
Sustained customer income underpins
performance
T
Positive operating trends underpinned by customer-related
income growth
T
Improvements in Hong Kong’s operating performance
T
Balance sheet remains strong
12
Hong Kong’s 1H earnings up 51% on year in
constant currency terms
Constant currency terms
1H
2011
1H
2010
YoY
%
YoY
%
2H
2010
HoH
%
HoH
%
Net interest income
389
400
(3)
9
383
2
7
Non-interest income
377
330
14
27
352
7
14
Total income
766
730
5
17
735
4
11
Expenses
309
396
(22)
(13)
324
(5)
1
Profit before
allowances
457
334
37
53
411
11
18
Allowances
63
39
62
84
34
85
94
333
245
36
51
334
(0)
5
(S$m)
Net profit
Figures for Hong Kong geographical basis and converted to S$ using monthly closing rates
Based on Singapore GAAP
13
Hong Kong’s 2Q earnings rise on year as
operating trends improve
Constant currency terms
(S$m)
2Q
2011
2Q
2010
YoY
%
YoY
%
1Q
2011
QoQ
%
QoQ
%
Net interest income
199
198
1
13
190
5
8
Non-interest income
177
165
7
21
200
(12)
(8)
Total income
376
363
4
17
390
(4)
(0)
Expenses
154
249
(38)
(30)
155
(1)
2
Profit before
allowances
222
114
95
>100
235
(6)
(2)
Allowances
54
32
69
90
9
>100
>100
143
65
>100
>100
190
(25)
(22)
Net profit
Figures for Hong Kong geographical basis and converted to S$ using monthly closing rates
Based on Singapore GAAP
14
Hong Kong’s 1H ROA improves on year
2Q
2011
2Q
2010
1Q
2011
1H
2011
1H
2010
2H
2010
1.52
1.68
1.48
1.50
1.73
1.53
Non-interest income/total
income
47
46
51
49
45
48
Cost/income
41
69
40
40
54
44
ROA
0.99
0.64
1.33
1.16
0.93
1.15
Loans/deposits
107
104
103
107
104
99
(%)
Net interest margin
15
Contributions from regional operations improve
(S$m)
1H
2011
1H
2010
YoY
%
2H
2010
HoH
%
Net interest income
504
433
16
419
20
Non-interest income
189
183
3
140
35
Total income
693
616
13
559
24
Expenses
321
281
14
313
3
Profit before allowances
372
335
11
246
51
25
94
(73)
92
(73)
308
218
41
165
87
Allowances
Net profit
Figures for operations outside of Singapore and Hong Kong
16
Sustained customer income underpins
performance
T
Positive operating trends underpinned by customer-related
income growth
T
Improvements in Hong Kong’s operating performance
T
Balance sheet remains strong
17
NPL ratio improves from customer repayments
and loan upgrading
NPA (S$m)
NPL Ratio (%)
Not overdue
90 days overdue
2.9
2.7
2.3
1.9
2.1
1.9
1.5
1.5
4,219
43%
2,392
36%
19%
8%
SP/loans (bp)
4,068
3,213
40%
3,724
41%
26%
7%
21%
7%
3,505
38%
6%
3,213
3,098
40%
38%
7%
11%
2,883
55%
52%
53%
57%
53%
51%
8%
37%
2010
1Q
2Q
3Q
4Q
1Q
2Q
43
97
19
33
25
9
7
49%
53%
2008
2009
35
85
45%
1.8
Cumulative general and specific allowances as % of:
NPAs
114
83
100
92
101
97
100
103
113
Unsecured NPAs
176
108
127
119
126
124
127
134
148
18
New NPAs remain low
(S$m)
NPAs at start of period
New NPAs
Net recoveries of existing NPAS
Write-offs
NPAs at end of period
2Q
2011
1Q
2011
2Q
2010
3,098
3,213
4,068
91
108
115
(266)
(111)
(268)
(40)
(112)
(191)
2,883
3,098
3,724
19
Specific allowances decline
2Q
2011
1Q
2011
2Q
2010
New NPLs
44
20
29
Existing NPLs
56
70
104
100
90
133
4
0
0
Settlements
38
43
54
Recoveries
31
13
11
73
56
65
27
34
68
7
9
19
(S$m)
Add charges for
Substract charges for
Upgrading
Total SP charges
SP / average loans (bp)
20
AFS portfolio well-balanced between investmentgrade government and corporate debt
(S$m)
Jun
2011
Mar
2011
Singapore government securities
11,371
10,308
8,530
8,061
10,524
10,261
1,023
1,104
31,448
29,734
Other government securities
Corporate debt securities
Equities
Total
21
Capital ratios remain strong
(%)
18.4
16.7
17.1
3.6
16.5
16.3
3.7
3.4
3.2
13.1
13.4
13.1
13.1
Dec 08
Dec 09
Mar 10
Jun 10
Core Tier 1 (%)
8.0
11.0
11.3
RWA (S$bn)
183
177
176
14.0
Tier 2
Tier 1
17.2
3.3
3.0
16.5
3.0
3.9
15.1
14.2
13.5
Sep 10
Dec 10
Mar 11
Jun 11
11.1
11.2
11.8
11.5
11.5
185
187
183
190
198
10.1
22
Interim dividend of 28 cents per share
(S¢)
Special (gross)
68
63
4
17
Quarterly (gross)
Quarterly (one-tier)
Half-yearly (one-tier)
65
14
17
56
56
14
17
17
14
28
14
28
17
17
14
14
14
28
14
17
17
14
14
2006
2007
2008
2009
2010
2011
23
In summary – sustained customer income
underpins performance
First-half results underscore momentum in implementing
strategic initiatives
Will remain focused on execution to take advantage of growth
opportunities
Well-positioned to weather near-term uncertainties
24
Sustained customer income
underpins performance
DBS Group Holdings
2Q 2011 financial results
July 28, 2011
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 Bank accepts no liability whatsoever with respect to the use of this document or its contents.