financial performance 4q10
DBS Group Holdings Ltd
Incorporated in the Republic of Singapore
Company Registration Number: 199901152M
To: Shareholders
The DBS Group Holdings Ltd (“DBSH” or “the Company”) Board of Directors report audited financial
results for the year ended 31 December 2010.
With effect from the second half of 2010, DBS has reverted to semi-annual dividend payments. For the
financial year ended 31 December, the Directors have recommended a final one-tier tax exempt dividend
of 2 cents for each DBSH non-voting convertible preference share (“CPS”) and each DBSH non-voting
redeemable CPS, and a final one-tier tax exempt dividend of 28 cents for each DBSH ordinary share.
Details of these proposed dividends, along with interim ones paid during the course of the financial year,
are as follows:
In $ millions
2010
2009
DBSH Non-voting Convertible Preference Share (“CPS”)
Interim one-tier tax exempt dividend* of 28.0 cents (2009 : 30.0 cents )
Final one-tier tax exempt dividend of 2.0 cents (2009: nil cents)
DBSH Non-voting redeemable CPS
Interim one-tier tax exempt dividend* of 28.0 cents (2009 : 30.0 cents )
Final one-tier tax exempt dividend of 2.0 cents (2009: nil cents)
DBSH Ordinary share
Interim one-tier tax exempt dividend* of 28.0 cents (2009 : 42.0 cents )
Final one-tier tax exempt dividend of 28.0 cents (2009 : 14.0 cents )
(a)
(a)
(a)
-
28
30
2
-
638
959
646
320
1,284
1,279
* Interim dividends were paid to entitled shareholders during the year
(a)
Amounts under $500,000
The 2010 final one-tier tax exempt dividend, to which the DBSH Scrip Dividend Scheme will be
applicable, will be subject to shareholders’ approval at the Annual General Meeting to be held on 28
April 2011. The DBSH shares will be quoted ex-dividend on 12 May 2011. Notice is hereby given that
the Share Transfer Books and Register of Members of the Company will be closed on 18 May 2011.
Duly completed transfers received by the Company's Registrar, Tricor Barbinder Share Registration
Services of 8 Cross Street #11-00 PWC Building, Singapore 048424 up to 5.00 p.m. on 16 May 2011
will be registered to determine shareholders' entitlement to the 2010 final one-tier tax exempt dividend.
The issue price for new shares to be allotted to shareholders who have elected to receive the final
dividend in scrip shall be the average of the last dealt prices of each DBSH ordinary share on the SGXST for each of 12, 13 and 16 May 2011, to which a discount of 5% shall be applied.
The payment date for cash dividends / crediting of shares is expected to be in early July 2011. In
respect of ordinary shares in the securities accounts with The Central Depository (Pte) Limited (“CDP”),
the 2010 final one-tier tax exempt dividend will be paid by DBSH to CDP, which will in turn distribute the
dividend entitlements to shareholders, either in cash or by crediting the securities accounts of
shareholders with the relevant shares.
By order of the Board
Linda Hoon
Group Secretary
10 February 2011
Singapore
More information on the above announcement is available at www.dbs.com/investor
Performance Summary
Financial Results for the Fourth Quarter ended
31 December 2010 (Unaudited) and
For the Year 2010 (Audited)
DBS Group Holdings Ltd
Incorporated in the Republic of Singapore
Company Registration Number: 199901152M
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
Contents
Overview
Quarterly Breakdown
Net Interest Income
Net Fee and Commission Income
Other Non-Interest Income
Expenses
Allowances for Credit and Other Losses
Performance by Business Segments
Performance by Geography
Customer Loans
Non-Performing Assets and Loss Allowance Coverage
Funding Sources
Customer Deposits
Other Borrowings & Liabilities
Value at Risk and Trading Income
Capital Adequacy
Unrealised Valuation Surplus/(Losses)
Audited Consolidated Income Statement
Audited Consolidated Statement of Comprehensive Income
Audited Balance Sheets
Audited Consolidated Statement of Changes in Equity
Audited Statement of Changes in Equity
Audited Consolidated Cash Flow Statement
Additional Information
Issuance of Ordinary Shares
Adoption of New or Revised FRS and INT FRS
Disclosure on Certain Financial Instruments
Other Matters / Subsequent Events
Confirmation by the Board
Page
2
4
5
7
7
8
8
9
12
15
16
19
20
20
21
22
22
23
23
24
25
26
27
28
28
29
30
31
1
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
OVERVIEW
DBS Group Holdings Ltd (“DBSH”) prepares its consolidated DBSH Group (“Group”) financial statements in accordance with
Singapore Financial Reporting Standard (“FRS”), as modified by the requirements of Notice to Banks No. 612 “Credit Files,
Grading and Provisioning” issued by the Monetary Authority of Singapore. The accounting policies and methods of
computation applied for the current financial periods are consistent with those applied for the financial year ended 31
December 2009, with the exception of the adoption of new or revised FRS and Interpretations to FRS (“INT FRS”).
On 1 January 2010, the Group adopted the following new or revised FRS and INT FRS that are issued by the Accounting
Standard Council (ASC), and are relevant for the Group.
•
FRS 27 Consolidated and Separate Financial Statements
•
FRS 103 Business Combinations
•
FRS 39 (Amendments) Financial Instruments: Recognition and Measurement
- Eligible Hedged Items
- Embedded Derivatives
•
FRS 102 (Amendments) Share-Based Payment – Group Cash-settled Share-based Payment Transactions
•
INT FRS 109 (Amendments): Reassessment of Embedded Derivatives
•
INT FRS 117: Distributions of Non-cash Assets to Owners
•
Improvements to FRSs
Refer to page 28 for more information.
4th Qtr
2010
4th Qtr
2009
%
chg
3rd Qtr
2010
%
chg
Year
2010
Year
2009
%
chg
1,106
358
265
1,729
780
949
157
816
678
-
1,127
358
87
1,572
700
872
384
494
493
-
(2)
>100
10
11
9
(59)
65
38
-
1,079
340
390
1,809
726
1,083
195
919
722
-
3
5
(32)
(4)
7
(12)
(19)
(11)
(6)
-
4,318
1,397
1,351
7,066
2,925
4,141
911
3,332
2,650
(1,018)
4,455
1,394
754
6,603
2,604
3,999
1,529
2,536
2,064
-
(3)
79
7
12
4
(40)
31
28
NM
-
-
-
-
-
-
(23)
NM
678
493
38
722
(6)
1,632
2,041
(20)
Selected balance sheet items ($m)
Customer loans 2/
3/
Interbank assets
Total assets
152,094
23,298
283,710
130,583
24,189
258,644
16
(4)
10
147,785
25,820
279,436
3
(10)
2
152,094
23,298
283,710
130,583
24,189
258,644
16
(4)
10
Customer deposits 4/
Total liabilities
Shareholders’ funds
193,692
250,608
26,599
183,432
229,145
25,373
6
9
5
185,211
248,969
26,424
5
1
1
193,692
250,608
26,599
183,432
229,145
25,373
6
9
5
1.79
36.0
45.1
0.96
10.22
78.5
1.9
2.02
28.3
44.5
0.76
7.76
71.2
2.9
1.80
40.4
40.1
1.04
11.06
79.8
2.1
1.84
38.9
41.4
0.98
10.20
78.5
1.9
2.02
32.5
39.4
0.80
8.44
71.2
2.9
25
116
33
43
85
11.8
15.1
18.4
11.0
13.1
16.7
11.2
13.1
16.3
11.8
15.1
18.4
11.0
13.1
16.7
Selected income statement items ($m)
Net interest income
Net fee and commission income
Other non-interest income
Total income
Expenses
Profit before allowances
Allowances for credit and other losses
Profit before tax
Net profit
Goodwill charges
One-time items 1/
Net profit/(loss) including goodwill charges
and one-time items
Key financial ratios (%) (excluding
5/
goodwill charges and one-time items)
Net interest margin
Non-interest/total income
Cost/income ratio
Return on assets
6/
Return on equity
Loan/deposit ratio
NPL ratio
Specific allowances (loans)/average loans
(bp)
Core Tier 1 capital adequacy ratio
Tier 1 capital adequacy ratio
Total capital adequacy ratio
2
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
4th Qtr
2010
4th Qtr
2009
3rd Qtr
2010
Year
2010
Year
2009
1.16
0.85
1.25
1.15
0.91
1.16
11.25
0.85
10.85
1.25
11.18
0.70
11.25
0.90
10.85
1.13
0.83
1.20
1.11
0.88
1.13
11.04
0.83
10.65
1.20
10.97
0.68
11.04
0.87
10.65
Per share data ($)
Per basic share
– earnings excluding one-time items and
goodwill charges
– earnings
6/
– net book value
Per diluted share
– earnings excluding one-time items and
goodwill charges
– earnings
6/
– net book value
Notes:
1/ One-time items include an impairment charge for a Thai investment
2/ Includes customer loans classified as financial assets at fair value through profit or loss on the balance sheet
3/ Includes interbank assets classified as financial assets at fair value through profit or loss on the balance sheet
4/ Includes customer deposits classified as financial liabilities at fair value through profit or loss on the balance sheet
5/ Return on assets, return on equity, specific allowances (loan)/average loan and per share data for the quarters are computed on an annualised basis
6/ Non-controlling interests are not included as equity in the computation of net book value and return on equity
NM Not Meaningful
Fourth-quarter net profit rose 38% from a year ago to $678
million. Similar to the earlier quarters of 2010, non-interest
income was higher and allowances were lower than the
year-ago period.
Net profit was 6% lower than the previous quarter as net
trading income fell in line with quieter treasury markets
during the year-end and net income from financial
investments declined. Business volume trends continued
to be healthy.
Net interest income rose 3% from the previous quarter to
$1.11 billion. Loans grew 3% from corporate borrowing
across the region and housing loan drawdowns in
Singapore. Net interest margin was stable at 1.79%.
Non-interest income fell 15% from the previous quarter to
$623 million. Net fee income rose from higher investment
banking and wealth management revenues, but the impact
was more than offset by declines in net trading income
and net income on financial investments. Customer
revenues continued to account for a significant portion of
net trading income.
Expenses rose 7% from the previous quarter to $780
million due to higher brand marketing costs and
infrastructure investments.
The non-performing loan rate improved from 2.1% in the
previous quarter to 1.9%. General and specific
allowances of $157 million were set aside, 19% below
the previous quarter. Allowance coverage rose to 100%
from 97%.
For the full-year, net profit (before one-time items) rose
28% to $2.65 billion from higher customer-driven noninterest income and a decline in allowances.
Return on equity was 10.2% for the fourth quarter as
well as for the full year. DBS remained well capitalised
with total capital adequacy ratio at 18.4%, tier -1 at
15.1% and core tier-1 at 11.8%.
3
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
QUARTERLY BREAKDOWN
($m)
1st Qtr
2nd Qtr
3rd Qtr
4th Qtr
Full Year
1,076
1,066
(1)
1,112
1,067
(4)
1,140
1,079
(5)
1,127
1,106
(2)
4,455
4,318
(3)
586
647
10
680
748
10
437
730
67
445
623
40
2,148
2,748
28
1,662
1,713
3
1,792
1,815
1
1,577
1,809
15
1,572
1,729
10
6,603
7,066
7
Expenses
2009
2010
% chg
638
702
10
631
717
14
635
726
14
700
780
11
2,604
2,925
12
Allowances for credit and other losses
2009
2010
% chg
414
355
(14)
466
204
(56)
265
195
(26)
384
157
(59)
1,529
911
(40)
Profit before tax
2009
2010
% chg
630
678
8
708
919
30
704
919
31
494
816
65
2,536
3,332
31
Net profit
2009
2010
% chg
456
532
17
552
718
30
563
722
28
493
678
38
2,064
2,650
28
Add: One-time items and
goodwill charges 1/
2009
2010
% chg
(23)
NM
(1,018)
NM
-
-
(23)
(1,018)
(>100)
552
(300)
NM
563
722
28
493
678
38
2,041
1,632
(20)
Net interest income
2009
2010
% chg
Non interest income
2009
2010
% chg
Total income
2009
2010
% chg
Net profit including one-time items and goodwill charges
2009
433
2010
532
% chg
23
Note:
1/ One-time items include impairment charges for Thai investment
Revenues for all quarters were higher than the year-ago
period due to gains in non-interest income. Net interest
income was marginally lower as a decline in interest
margins offset the benefit of loan growth.
Expenses rose at a faster pace than revenues for the
second half of the year as headcount and investment costs
increased. The impact of cost increases was offset by a
decline in allowances. Profit before tax as well as net profit
was higher for all four quarters. The third quarter’s net profit
was a quarterly record.
4
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
NET INTEREST INCOME
Average balance
sheet
4th Qtr 2010
Average
Average
balance Interest
rate
($m)
($m)
(%)
4th Qtr 2009
Average
Average
balance Interest
rate
($m)
($m)
(%)
3rd Qtr 2010
Average
Average
balance Interest
rate
($m)
($m)
(%)
Interest-bearing
assets
Customer loans
Interbank assets
Securities
Total
149,104
46,548
48,851
244,503
1,011
105
345
1,461
2.69
0.90
2.79
2.37
128,152
41,697
51,613
221,462
968
82
387
1,437
3.00
0.78
2.97
2.57
145,902
40,880
51,010
237,792
1,009
97
351
1,457
2.74
0.95
2.73
2.43
Interest-bearing
liabilities
Customer deposits
Other borrowings
Total
189,502
34,624
224,126
245
110
355
0.51
1.26
0.63
180,701
22,859
203,560
219
91
310
0.48
1.58
0.60
184,815
33,766
218,581
269
109
378
0.58
1.28
0.69
1,106
1.79
1,127
2.02
1,079
1.80
Net interest
1/
income/margin
Year 2010
Average balance
sheet
Average
balance
($m)
Year 2009
Average Average
Interest
rate balance
($m)
(%)
($m)
Interest
($m)
Average
rate
(%)
Interest-bearing
assets
Customer loans
Interbank assets
Securities
Total
141,245
43,190
50,272
234,707
3,937
358
1,404
5,699
2.79
0.83
2.79
2.43
127,832
41,782
51,031
220,645
4,075
378
1,661
6,114
3.20
0.91
3.26
2.78
Interest-bearing
liabilities
Customer deposits
Other borrowings
Total
184,792
30,834
215,626
970
411
1,381
0.53
1.33
0.64
178,064
26,272
204,336
1,131
528
1,659
0.64
2.02
0.81
4,318
1.84
4,455
2.02
Net interest
1/
income/margin
Note:
1/ Net interest margin is net interest income expressed as a percentage of average interest-earning assets
Net interest income rose 3% from the previous quarter to
$1.11 billion.
Net interest margin was stable at 1.79%. While customer
loan yields were lower, deposit costs also declined, partly
the result of a shift in the deposit mix towards lower-yielding
currencies.
For the full year, net interest income fell 3% to $4.32 billion.
Net interest margins declined from 2.02% to 1.84% due to a
soft interest rate environment and normalising credit
spreads. The lower margins offset the benefit of higher
asset volumes and an improved asset mix.
5
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
4th Qtr 2010 versus 4th Qtr 2009
Volume and rate analysis ($m)
Increase/(decrease) due to change in
4th Qtr 2010 versus 3rd Qtr 2010
Volume
Rate
Net
change
Customer loans
Interbank assets
Securities
158
10
(20)
(115)
13
(22)
43
23
(42)
Total
148
(124)
10
31
41
107
Volume
Rate
Net
change
22
13
(20)
(5)
2
8
24
(14)
21
8
(17)
(6)
4
16
(12)
4
26
19
45
7
3
10
(31)
(2)
(33)
(24)
1
(23)
(128)
(21)
11
16
27
Interest income
Interest expense
Customer deposits
Other borrowings
Total
Net impact on interest income
Due to change in number of days
Net Interest Income
-
-
(21)
27
Year 2010 versus Year 2009
Volume and rate analysis ($m)
Increase/(decrease) due to change in
Volume
Rate
Net
change
426
13
(24)
415
(564)
(33)
(233)
(830)
(138)
(20)
(257)
(415)
42
39
81
(203)
(156)
(359)
(161)
(117)
(278)
334
(471)
(137)
Interest income
Customer loans
Interbank assets
Securities
Total
Interest expense
Customer deposits
Other borrowings
Total
Net impact on interest income
Due to change in number of days
Net Interest Income
(137)
6
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
NET FEE AND COMMISSION INCOME
($m)
Stockbroking
Investment banking
Trade and remittances
Loan related
Guarantees
Deposit related
Credit card
Fund management
Wealth management
Others
Total
4th Qtr
2010
4th Qtr
2009
% chg
3rd Qtr
2010
% chg
Year
2010
Year
2009
% chg
50
60
56
52
16
23
40
6
44
11
358
41
59
55
85
14
21
36
4
30
13
358
22
2
2
(39)
14
10
11
50
47
(15)
-
45
38
55
80
14
20
37
5
31
15
340
11
58
2
(35)
14
15
8
20
42
(27)
5
179
154
227
333
59
85
149
22
136
53
1,397
170
146
244
375
57
84
143
20
101
54
1,394
5
5
(7)
(11)
4
1
4
10
35
(2)
-
Net fee and commission income rose by 5% from the
previous quarter to $358 million. The gains were broadbased and led by higher investment banking activity and
improved demand for unit trusts and bancassurance
products. These gains were partly offset by a decline in
loan-related income.
Net fee and commission income for year was unchanged at
$1.40 billion. An improvement in wealth management
revenues was offset by lower margins in trade and
remittances and by a decline in loan-related fees.
OTHER NON-INTEREST INCOME
($m)
4th Qtr
2010
4th Qtr
2009
% chg
3rd Qtr
2010
% chg
Year
2010
Year
2009
% chg
Net trading income
Net (loss)/income from financial
instruments designated at fair value
Net income on financial
investments
Net gain on fixed assets
Others (include rental income)
154
179
(14)
235
(34)
915
700
31
10
(124)
NM
(12)
NM
(20)
(267)
93
39
3
>100
123
(68)
310
254
22
52
10
13
16
>100
(38)
34
10
53
-
103
43
13
54
>100
(20)
Total
265
87
>100
390
(32)
1,351
754
79
Note:
NM Not Meaningful
Net trading income (including net income from financial
instruments designated at fair value) fell 26% from the
previous quarter to $164 million. Customer revenues
continued to account for a substantial portion of net
trading income.
Net income on financial investments also declined from
the previous quarter due to fewer profit-taking
opportunities.
For the full year, other non-interest income rose 79% to
$1.35 billion as net trading income, net income on
financial investments and net gain on fixed assets rose.
7
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
EXPENSES
($m)
4th Qtr
2010
4th Qtr
2009
% chg
3rd Qtr
2010
% chg
Year
2010
Year
2009
% chg
Staff
Occupancy
Computerisation
Revenue-related
Others
Total
Staff headcount at period-end
362
67
164
37
150
780
15,847
313
56
143
39
149
700
14,033
16
20
15
(5)
1
11
13
360
67
145
33
121
726
15,206
1
0
13
12
24
7
4
1,422
269
569
136
529
2,925
15,847
1,292
265
473
132
442
2,604
14,033
10
2
20
3
20
12
13
56
1
48
1
17
-
43
1
30
-
193
3
195
3
1
-
-
1
-
2
-
6
5
-
Included in the above table were:
Depreciation of properties and other fixed
assets
Directors’ fees
Audit fees payable
Expenses grew 7% from the previous quarter to $780
million as brand marketing costs and computerisation
costs rose. The cost-income ratio increased to 45%.
For the full year, costs rose 12% to $2.93 billion as
headcount increased and infrastructure was rolled out to
support higher business volumes and initiatives to
develop growth opportunities.
ALLOWANCES FOR CREDIT AND OTHER LOSSES
($m)
4th Qtr
2010
4th Qtr
2009
% chg
3rd Qtr
2010
% chg
Year
2010
General allowances (GP)
44
(225)
NM
39
13
232
154
51
Specific allowances (SP) for loans1/
Singapore
Hong Kong
Rest of Greater China
97
8
3
(2)
387
8
15
22
(75)
(80)
NM
125
(1)
8
17
(22)
NM
(63)
NM
614
18
14
25
1,113
149
185
54
(45)
(88)
(92)
(54)
South and South-east Asia
Rest of the world
20
68
12
330
67
(79)
15
86
33
(21)
47
510
31
694
52
(27)
Specific allowances (SP) for securities,
properties and other assets 2/
16
222
(93)
31
(48)
65
262
(75)
157
384
(59)
195
(19)
911
1,529
(40)
Total
Year % chg
2009
Notes:
1/ Specific allowances for loans are classified according to where the borrower is incorporated. Historical comparatives have been restated to conform to the current year presentation
2/ Excludes one-time items
Specific allowances for loans fell to $97 million (25 basis
points of loans) from $125 million (33 basis points) in the
previous quarter. Most of the charges were for existing
NPLs. General allowances rose slightly to $44 million.
For the full year, total allowances fell 40% to $911
million as specific allowances for loans fell 45% to $614
million in line with improved asset quality.
8
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
PERFORMANCE BY BUSINESS SEGMENTS 1/
($m)
Institutional
Banking
Consumer/
Private
Banking
Selected income items
4th Qtr 2010
Net interest income
Non-interest income
Total income
Expenses
Allowances for credit and other losses
Share of profits of associates
Profit before tax
Income tax expense
Net profit
3rd Qtr 2010
Net interest income
Non-interest income
Total income
Expenses
Allowances for credit and other losses
Share of profits of associates
Profit before tax
Income tax expense
Net profit
4th Qtr 2009
Net interest income
Non-interest income
Total income
Expenses
Allowances for credit and other losses
Share of profits of associates
Profit before tax
Income tax expense
Net profit
Year 2010 2/
Net interest income
Non-interest income
Total income
Expenses
Allowances for credit and other losses
Share of profits of associates
Profit before tax
Income tax expense
Net profit
Treasury
Others
Total
348
513
233
12
178
372
(66)
139
1,106
623
526
885
167
151
1,729
401
5
331
160
101
(4)
(53)
(4)
780
157
-
5
-
19
24
120
399
70
227
816
17
68
13
(27)
71
103
341
57
177
678
338
505
210
26
1,079
164
399
125
42
730
502
904
335
68
1,809
357
15
282
149
96
(3)
(9)
34
726
195
-
6
-
25
31
130
479
242
68
919
20
78
34
14
146
110
410
208
(6)
722
369
481
278
(1)
1,127
156
323
(72)
38
445
525
804
206
37
1,572
387
(9)
269
417
62
(43)
(18)
19
700
384
-
9
-
(3)
6
147
127
187
33
494
23
(9)
37
(98)
(47)
124
146
150
73
493
1,398
1,995
840
85
4,318
667
1,518
393
170
2,748
2,065
3,513
1,233
255
7,066
1,471
55
1,119
812
368
(2)
(33)
46
2,925
911
-
25
-
77
102
539
1,607
867
319
3,332
81
274
134
(35)
454
458
1,360
733
99
2,650
9
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
($m)
Consumer/
Private
Banking
Year 2009 2/
Net interest income
Non-interest income
Total income
Expenses
Allowances for credit and other losses
Share of profits of associates
Profit before tax
Income tax expense
Net profit
Selected balance sheet and other
items 3/
31 Dec 2010
Total assets before goodwill
Goodwill on consolidation
Total assets
Total liabilities
Capital expenditure for 4th Qtr 2010
Depreciation for 4th Qtr 2010 3/
30 Sept 2010
Total assets before goodwill
Goodwill on consolidation
Total assets
Total liabilities
Capital expenditure for 3rd Qtr 2010
Depreciation for 3rd Qtr 2010 3/
31 Dec 2009
Total assets before goodwill
Goodwill on consolidation
Total assets
Total liabilities
Capital expenditure for 4th Qtr 2009
Depreciation for 4th Qtr 2009 3/
Institutional
Banking
Treasury
Others
Total
1,399
1,844
1,223
(11)
4,455
609
1,328
26
185
2,148
2,008
3,172
1,249
174
6,603
1,245
82
964
1,118
324
7
71
322
2,604
1,529
-
28
-
38
66
681
1,118
918
(181)
2,536
109
197
195
(216)
285
572
974
723
(205)
2,064
51,328
118,572
98,735
10,273
117,529
22
11
80,559
16
6
42,584
8
2
9,936
44
37
278,908
4,802
283,710
250,608
90
56
49,706
115,390
99,611
9,927
113,944
9
11
74,842
2
4
50,908
3
9,275
22
25
45,094
100,649
97,959
9,095
115,194
14
14
69,084
5
6
31,262
3
2
13,605
37
26
274,634
4,802
279,436
248,969
33
43
252,797
5,847
258,644
229,145
59
48
Notes:
1/ With effect from 1 January 2010, the Group has adopted a revised capital benefit and fund transfer policy. The business segments have also been reaggregated following a review.
Comparative figures have been restated to conform to the current year presentation
2/ Excludes goodwill charges and one-time items
3/ Amounts for each business segment are shown before allocation of centralised cost
4/ Refer to sections on Customer Loans and Non-Performing Assets and Loss Allowance Coverage for more information on business segments
10
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
The business segment results are prepared based on
the Group’s internal management reporting which
reflects the organisation management structure. As the
activities of the Group are highly integrated, internal
allocation has been made in preparing the segment
information. Amounts for each business segment are
shown after the allocation of certain centralised costs,
funding income and the application of transfer pricing,
where appropriate. Transactions between segments are
recorded within the segment as if they are third party
transactions and are eliminated on consolidation. During
the quarter, no one group of related customers
generated more than 10% of the Group’s revenues.
The external presentation of the business segment
results has been revised from first-quarter 2010 to better
reflect internal management reporting. In addition, the
Group adopted a revised capital benefit and fund
transfer policy with effect from 1 January 2010.
Comparative figures have been restated to conform to
the current presentation.
The various business segments are described below:
Consumer/ Private Banking
Consumer/ Private Banking provides individual customers
with a diverse range of banking and related financial
services. The products and services available to customers
include current and savings accounts, fixed deposits, loans
and home finance, cards, payments, investment and
insurance products.
Compared to the previous quarter, net interest income
was higher from loan growth, which more than offset
lower housing loan margins. Non-interest income
benefited from higher wealth management and credit
card revenues. Expenses were higher due to higher staff
costs arising from headcount increases as well as
investments in infrastructure. Specific allowances for
private banking were lower.
For the full year, net interest income was unchanged as
higher loan volumes were offset by lower housing loan
margins. Non-interest income benefited from better
wealth management revenues. The increase in expenses
was due to compensation to customers who had bought
Constellation notes in Hong Kong, as well as higher staff
and infrastructure costs. Specific allowances declined for
unsecured loan and private banking clients, which more
than offset an increase in general allowances.
Institutional Banking
Institutional Banking provides financial services and
products to institutional clients including non bank
financial institutions, government linked companies,
large corporates and small and medium-sized
businesses. The business focus is to broaden and
deepen the financial relationship with clients. The
products and services available to customers include long
and short term credit facilities ranging from specialised
lending such as asset financing, project financing and real
estate financing to overdraft, trade, receivables financing
and structured trade; cash management and deposit;
treasury and markets; corporate finance and advisory
banking services for mergers and acquisitions, capital
raising through debt and equity markets, capital
restructuring, syndicated finance, securities and fiduciary
services and private equity. Institutional Banking also
provides equity services through DBS Vickers Securities
(DBSV). DBSV offers a wide range of services to retail
and corporate customers including research, sales and
trading, share placement, nominees and securities
custodian services and distribution of primary and
secondary issues.
Net interest income rose from the previous quarter as
higher loan volumes were partially offset by lower margins.
Non-interest income fell as lower loan-related and treasury
product sales revenues were partially offset by higher
investment banking revenue. Expenses rose due to higher
infrastructure investments. General allowances were
higher.
For the full year, net interest income rose with higher loan
volumes, while non-interest income growth was driven by
treasury product sales. Both staff and non-staff costs were
higher. Specific allowances declined with asset quality
improvements while general allowances rose in line with
stronger loan growth.
Treasury
Treasury provides treasury services to corporations,
institutional and private investors, financial institutions and
other market participants. It is primarily involved in sales,
structuring, market making and trading across a broad
range of financial products including foreign exchange,
interest rate, debt, credit, equity and other structured
derivatives. Income from these financial products and
services offered to the customer of other business
segments, such as Consumer/Private Banking and
Institutional Banking, is reflected in the respective
segments. Treasury is also responsible for facilitating the
execution of Group’s asset and liability interest rate
positions and management of the investment of the
Group’s excess liquidity and shareholders’ funds.
Treasury’s total revenues were lower than the previous
quarter due to quieter year-end markets. For the full year,
total revenues were little changed.
Others
Others encompasses a range of activities from corporate
decisions and income and expenses not attributed to other
business segments.
11
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
PERFORMANCE BY GEOGRAPHY
($m)
S’pore
Hong
Kong
Rest of
Greater
China
South
and
Southeast Asia
Rest of
world
Total
Selected income items
4th Qtr 2010
Net interest income
Non-interest income
Total income
Expenses
Allowances for credit and other losses
Share of profits of associates
Profit before tax
Income tax expense
Net profit
704
417
1,121
445
111
3
568
30
471
192
157
349
177
16
156
12
144
88
4
92
98
7
5
(8)
7
(15)
68
33
101
45
13
16
59
7
52
54
12
66
15
10
41
15
26
1,106
623
1,729
780
157
24
816
71
678
3rd Qtr 2010
Net interest income
Non-interest income
Total income
Expenses
Allowances for credit and other losses
Share of profits of associates
Profit before tax
Income tax expense
Net profit
679
444
1,123
424
115
2
586
105
430
191
195
386
147
18
221
31
190
84
39
123
80
21
4
26
6
20
68
35
103
57
41
25
30
(4)
34
57
17
74
18
56
8
48
1,079
730
1,809
726
195
31
919
146
722
4th Qtr 2009
Net interest income
Non-interest income
Total income
Expenses
Allowances for credit and other losses
Share of profits of associates
Profit before tax
Income tax expense
Net profit
704
250
954
410
209
3
338
(45)
335
216
126
342
154
37
151
23
128
75
13
88
81
35
6
(22)
(9)
(13)
79
26
105
46
15
(3)
41
6
35
53
30
83
9
88
(14)
(22)
8
1,127
445
1,572
700
384
6
494
(47)
493
Year 2010 1/
Net interest income
Non-interest income
Total income
Expenses
Allowances for credit and other losses
Share of profits of associates
Profit before tax
Income tax expense
Net profit
2,683
1,743
4,426
1,611
652
10
2,173
257
1,688
783
682
1,465
720
73
672
93
579
327
99
426
325
52
20
69
22
47
283
174
457
207
79
72
243
40
203
242
50
292
62
55
175
42
133
4,318
2,748
7,066
2,925
911
102
3,332
454
2,650
12
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
($m)
S’pore
Year 2009 1/
Net interest income
Non-interest income
Total income
Expenses
Allowances for credit and other losses
Share of profits of associates
Profit before tax
Income tax expense
Net profit
Hong
Kong
Rest of
Greater
China
South
and
Southeast Asia
Rest of
world
Total
2,738
1,253
3,991
1,512
1,034
16
1,461
88
1,186
888
478
1,366
600
210
556
92
464
302
107
409
270
74
17
82
14
68
326
175
501
172
69
33
293
67
226
201
135
336
50
142
144
24
120
4,455
2,148
6,603
2,604
1,529
66
2,536
285
2,064
Selected balance sheet items
31 Dec 2010
Total assets before goodwill
Goodwill on consolidation
Total assets
Non-current assets 2/
Gross customer loans
179,813
4,802
184,615
1,623
91,128
52,489
52,489
406
36,224
21,033
21,033
129
12,208
13,710
13,710
36
9,121
11,863
11,863
2
6,041
278,908
4,802
283,710
2,196
154,722
30 Sept 2010
Total assets before goodwill
Goodwill on consolidation
Total assets
Non-current assets 2/
Gross customer loans
176,623
4,802
181,425
1,587
86,521
53,149
53,149
458
37,036
18,861
18,861
126
11,541
14,115
14,115
37
9,436
11,886
11,886
2
6,000
274,634
4,802
279,436
2,210
150,534
31 Dec 2009
Total assets before goodwill
Goodwill on consolidation
Total assets
Non-current assets 2/
Gross customer loans
165,652
5,847
171,499
1,485
75,117
47,653
47,653
530
33,431
14,362
14,362
142
10,252
12,743
12,743
46
8,058
12,387
12,387
1
6,562
252,797
5,847
258,644
2,204
133,420
Notes:
1/ Allowances for credit and other losses and profits exclude goodwill charges and one-time items
2/ Includes investment in associates, properties and other fixed assets, and investment properties
13
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
The performance by geography is classified based on the
location in which income and assets are recorded.
Singapore
Net profit rose 10% from the previous quarter to $471
million. The tax rate declined due to a write-back of
previous accruals.
Net interest income rose 4% from the previous quarter in
line with higher corporate and housing loan volumes.
Non-interest income declined 6% due to lower trading
gains and loan-related fees, which were partially offset by
higher investment banking and wealth management
revenues.
Expenses rose 5% as advertising and infrastructure
investments rose. Allowances were stable.
For the full year, net profit rose 42% to $1.69 billion from
better treasury product sales revenues and lower specific
allowances. These improvements were partially offset by
lower interest margins and higher expenses. There was
also a larger tax-writeback in 2009.
Hong Kong
The fourth quarter’s results incorporate an appreciation of
the Singapore dollar against the Hong Kong dollar of 3%
from the previous quarter and 7% from a year ago.
Net profit fell 24% from the previous quarter to $144 million
as non-interest income declined and expenses rose.
Net interest income was stable from the previous quarter.
Loan volumes were little changed while deposits grew 6%
in local currency terms. Net interest margin fell seven basis
points to 1.49% as interbank rates declined and the asset
mix had a larger proportion of interbank assets.
Non-interest income fell 19% from the previous quarter as
loan-related fees and trading income declined, which were
partially offset by better wealth management revenues and
higher gains from fixed asset sales.
Expenses rose 20% due to higher advertising,
infrastructure and staff costs. Allowances declined 11% as
general allowances fell. Specific allowances were stable.
For the full year, net profit rose 25% to $579 million as
non-interest income benefited from stronger treasury
product sales and as specific allowances declined. These
gains were partially offset by lower interest margins and
an increase in staff and infrastructure investment costs.
14
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
CUSTOMER LOANS
1/
($m)
31 Dec 2010
30 Sept 2010
31 Dec 2009
154,722
150,534
133,420
General allowances
Net total
1,152
1,476
152,094
1,300
1,449
147,785
1,512
1,325
130,583
By business unit 2/
Consumer/ Private Banking
Institutional Banking
Others
Total (Gross)
50,256
103,219
1,247
154,722
49,108
100,214
1,212
150,534
44,162
88,503
755
133,420
By geography 3/
Singapore
Hong Kong
Rest of Greater China
South and South-east Asia
Rest of the world
Total (Gross)
74,595
36,688
13,495
13,976
15,968
154,722
72,997
36,541
11,322
13,677
15,997
150,534
61,713
32,999
11,211
11,726
15,771
133,420
By industry
Manufacturing
Building and construction
Housing loans
General commerce
Transportation, storage & communications
Financial institutions, investment & holding companies
Professionals & private individuals (except housing loans)
Others
Total (Gross)
19,217
21,385
38,676
16,732
14,378
18,517
11,142
14,675
154,722
17,814
21,194
38,030
15,053
13,714
19,868
10,652
14,209
150,534
16,239
18,433
33,120
13,335
12,277
16,710
10,873
12,433
133,420
67,439
30,478
38,094
18,711
154,722
64,908
31,789
35,755
18,082
150,534
56,712
30,274
29,449
16,985
133,420
Gross
Less:
Specific allowances
By currency
Singapore dollar
Hong Kong dollar
US dollar
Others
Total (Gross)
Notes:
1/ Includes customer loans classified as financial assets at fair value through profit or loss on the balance sheet
2/ The business segments have been reaggregated following a review. Historical comparatives have been restated to conform to the current year presentation
3/ Loans by geography are classified according to where the borrower is incorporated. Historical comparatives have been restated to conform to the current year presentation
Gross customer loans rose 3% from the previous
quarter to $154.7 billion. Excluding currency effects,
loan growth was 4%. The growth was led by broadbased regional corporate loan demand. Housing loan
growth was due to drawdowns in Singapore.
Gross loans were 16% higher than a year ago, with half
of the increase in Singapore-dollar loans. The
expansion was spread across most regions and across
corporate and consumer borrowers.
15
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
NON-PERFORMING ASSETS AND LOSS ALLOWANCE COVERAGE
By business unit
1/
2/
NPA
($m)
SP
($m)
GP
($m)
NPL
(% of loans)
(GP+SP)/NPA
(%)
(GP+SP)/
unsecured
NPA
(%)
317
107
502
0.6
192
323
2,561
1,105
974
2.5
81
102
2,878
1,212
1,476
1.9
93
121
28
6
124
-
464
1,300
307
127
252
-
123
134
3,213
1,345
1,852
-
100
127
377
163
490
0.8
173
268
2,794
1,215
959
2.8
78
100
3,171
1,378
1,449
2.1
89
117
112
77
122
-
177
211
222
112
249
-
163
174
3,505
1,567
1,820
-
97
124
513
195
440
1.2
124
236
3,363
1,410
885
3.8
68
86
3,876
1,605
1,325
2.9
76
100
160
106
92
-
124
164
183
97
255
-
192
209
4,219
1,808
1,672
-
83
108
31 Dec 2010
Consumer/ Private
Banking
Institutional Banking
Total non-performing
loans (NPL)
Debt securities
Contingent liabilities &
others
Total non-performing
assets (NPA)
30 Sept 2010
Consumer/ Private
Banking
Institutional Banking
Total non-performing
loans (NPL)
Debt securities
Contingent liabilities &
others
Total non-performing
assets (NPA)
31 Dec 2009
Consumer/ Private
Banking
Institutional Banking
Total non-performing
loans (NPL)
Debt securities
Contingent liabilities &
others
Total non-performing
assets (NPA)
Notes:
1/ Allowances for credit and other losses exclude one-time items
2/ The business segments have been reaggregated following a review. Historical comparatives have been restated to conform to the current year presentation
16
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
By geography
31 Dec 2010
Singapore
Hong Kong
Rest of Greater China
South and South-east
Asia
Rest of the World
Total non-performing
loans
Debt securities
Contingent liabilities
& others
Total non-performing
assets
30 Sept 2010
Singapore
Hong Kong
Rest of Greater China
South and South-east
Asia
Rest of the World
Total non-performing
loans
Debt securities
Contingent liabilities
& others
Total non-performing
assets
31 Dec 2009
Singapore
Hong Kong
Rest of Greater China
South and South-east
Asia
Rest of the World
Total non-performing
loans
Debt securities
Contingent liabilities
& others
Total non-performing
assets
NPA
($m)
SP
($m)
GP
($m)
NPL
(% of loans)
(GP+SP)/NPA
(%)
(GP+SP)/
unsecured
NPA
(%)
594
359
250
196
212
166
613
369
145
0.8
1.0
1.9
136
162
124
300
230
176
164
107
189
1.2
180
185
1,511
531
160
9.5
46
50
2,878
1,212
1,476
1.9
93
121
28
6
124
-
464
1,300
307
127
252
-
123
134
3,213
1,345
1,852
-
100
127
635
377
270
195
226
190
611
367
123
0.9
1.0
2.4
127
157
116
311
222
154
146
92
191
1.1
195
200
1,743
675
157
10.9
48
54
3,171
1,378
1,449
2.1
89
117
112
77
122
-
177
211
222
112
249
-
163
174
3,505
1,567
1,820
-
97
124
731
567
352
213
327
213
546
330
121
1.2
1.7
3.1
104
116
95
244
173
143
157
82
174
1.3
163
186
2,069
770
154
13.1
45
49
3,876
1,605
1,325
2.9
76
100
160
106
92
-
124
164
183
97
255
-
192
209
4,219
1,808
1,672
-
83
108
17
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
By industry
($m)
31 Dec 2010
30 Sept 2010
31 Dec 2009
NPA
SP
NPA
SP
NPA
SP
Manufacturing
Building and construction
Housing loans
General commerce
Transportation, storage & communications
Financial institutions, investment & holding companies
502
90
118
248
646
960
325
25
17
107
183
399
533
39
125
322
628
1,200
330
12
19
161
150
545
735
89
188
472
264
1,738
386
22
30
238
97
621
Professionals & private individuals (except housing
loans)
173
74
174
74
234
113
Others
Total non-performing loans
Debt securities
Contingent liabilities & others
Total non-performing assets
By loan classification
($m)
Non-performing assets
Substandard
Doubtful
Loss
Total
Restructured assets
Substandard
Doubtful
Loss
Total
By collateral type
($m)
141
82
150
87
156
98
2,878
28
1,212
6
3,171
112
1,378
77
3,876
160
1,605
106
307
127
222
112
183
97
3,213
1,345
3,505
1,567
4,219
1,808
31 Dec 2010
30 Sept 2010
31 Dec 2009
NPA
SP
NPA
SP
NPA
SP
2,086
737
390
3,213
374
580
391
1,345
2,013
993
499
3,505
342
723
502
1,567
2,155
1,431
633
4,219
195
977
636
1,808
443
145
28
616
47
128
28
203
422
218
30
670
55
120
30
205
389
90
54
533
51
73
54
178
31 Dec 2010
30 Sept 2010
31 Dec 2009
NPA
NPA
NPA
2,523
2,726
3,233
Secured non-performing assets by collateral type
Properties
250
284
540
Shares and debentures
Fixed deposits
Others
85
38
317
112
37
346
124
22
300
3,213
3,505
4,219
Unsecured non-performing assets
Total
18
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
By period overdue
($m)
31 Dec 2010
30 Sept 2010
31 Dec 2009
NPA
NPA
NPA
Not overdue
180 days overdue
1,294
225
124
1,570
1,323
198
655
1,329
1,802
358
113
1,946
Total
3,213
3,505
4,219
Non-performing loans fell 9% from the previous quarter
and 26% from a year ago to $2.9 billion. The NPL rate
was 1.9%, compared to 2.1% in the previous quarter and
2.9% a year ago. Forty percent of classified nonperforming assets were still current in interest and
principal.
Allowance coverage amounted rose to 100% of nonperforming assets from 97% in the previous quarter and
83% a year ago.
FUNDING SOURCES
($m)
Customer deposits 1/
Interbank liabilities 2/
Other borrowings and liabilities 2/
Shareholders’ funds
Total
31 Dec 2010
30 Sept 2010
31 Dec 2009
193,692
18,854
44,565
26,599
283,710
185,211
19,720
48,081
26,424
279,436
183,432
9,320
40,519
25,373
258,644
Notes:
1/
Includes customer deposits classified as financial liabilities at fair value through profit or loss on the balance sheet
2/
Includes liabilities classified as financial liabilities at fair value through profit or loss on the balance sheet
19
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
CUSTOMER DEPOSITS 1/
($m)
By currency and product
Singapore dollar
Fixed deposits
Savings accounts
Current accounts
Others
Hong Kong dollar
Fixed deposits
Savings accounts
Current accounts
Others
US dollar
Fixed deposits
Savings accounts
Current accounts
Others
Others
Fixed deposits
Savings accounts
Current accounts
Others
Total
Fixed deposits
Savings accounts
Current accounts
Others
31 Dec 2010
30 Sept 2010
31 Dec 2009
112,228
20,081
76,417
14,916
814
23,220
12,946
7,082
3,081
111
30,022
16,064
3,255
9,777
926
28,222
22,289
2,035
2,341
1,557
193,692
71,380
88,789
30,115
3,408
105,672
16,473
74,068
14,431
700
23,159
12,427
6,902
3,666
164
28,699
15,969
3,244
7,815
1,671
27,681
21,725
2,286
2,197
1,473
185,211
66,594
86,500
28,109
4,008
103,842
20,617
69,160
12,697
1,368
23,625
12,285
7,932
3,254
154
29,018
14,912
3,468
8,846
1,792
26,947
20,441
2,191
2,908
1,407
183,432
68,255
82,751
27,705
4,721
Note:
1/ Includes customer deposits classified as financial liabilities at fair value through profit or loss on the balance sheet
Customer deposits rose 5% from the previous quarter to
$193.7 billion as Singapore-dollar fixed and savings
deposits rose. There was also an increase in US dollar
current accounts.
Compared to a year ago, deposits rose 6%, with
Singapore-dollar savings accounts accounting for more
than half of the increase.
OTHER BORROWINGS & LIABILITIES
($m)
Subordinated term debts1/
Other debt securities in issue
Due within 1 year
Due after 1 year
Comprising:
2/
Secured
Unsecured
Others
Total
31 Dec 2010
30 Sept 2010
31 Dec 2009
6,398
6,572
7,702
505
1,655
530
1,615
44
369
2,160
36,007
44,565
2,145
39,364
48,081
75
338
32,404
40,519
Notes:
1/ All subordinated term debts issued are unsecured
2/ These are mainly secured by properties and securities
20
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
VALUE AT RISK AND TRADING INCOME
The Group uses a Value at Risk (VaR) measure as one mechanism for monitoring and controlling trading risk. The VaR is
calculated using a one-day time horizon and a 99% confidence interval. The following table shows the period-end, average,
high and low VaR for the trading risk exposure of the Group for the period from 1 January 2010 to 31 December 2010. The
Group’s trading book VaR methodology is based on Historical Simulation VaR.
($m)
1 January 2010 to 31 December 2010
Average
High
Low
As at 31 December 2010
Total
31
27
39
15
The charts below provide the range of VaR and the daily distribution of trading income in the trading portfolio for the
period from 1 January 2010 to 31 December 2010.
DBSH VaR for Trading Book
45
40
No. of Days
35
30
25
20
15
10
5
> 38- 39
> 37- 38
> 36- 37
> 35- 36
> 34- 35
> 33- 34
> 32- 33
> 31- 32
> 30- 31
> 29- 30
> 28- 29
> 27- 28
> 26- 27
> 25- 26
> 24- 25
> 23- 24
> 22- 23
> 21- 22
> 20- 21
> 19- 20
> 18- 19
> 17- 18
> 16- 17
> 15- 16
0
VaR ( S$ m illion)
Note:
With effect from 1 Jun 2009, the number of historical scenarios used for the VaR calculation was revised from 500 days to 250 days
Daily Distribution of Group Trading Income
(1 Jan 2010 to 31 Dec 2010)
45
40
35
25
20
15
10
5
Trading income (S$ million)
21
>28-30
>26-28
>24-26
>22-24
>20-22
>18-20
>16-18
>14-16
>12-14
>10-12
>8-10
>6-8
>4-6
>2-4
>0-2
>(2)-0
>(4)-(2)
>(6)-(4)
>(8)-(6)
0
>(10)-(8)
No. of days
30
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
CAPITAL ADEQUACY
($m)
Tier 1
Share capital
Disclosed reserves and others
Less: Tier 1 Deductions
Eligible Tier 1
Tier 2
Loan allowances admitted as Tier 2
Subordinated debts
Revaluation surplus from equity securities
Less: Tier 2 Deductions
Total eligible capital
Risk-weighted assets
Capital adequacy ratio (%)
Core Tier 1 ratio
Tier 1 ratio
Tier 2 ratio
Total (Tier 1 & 2) ratio
31 Dec 2010
30 Sept 2010
31 Dec 2009
8,780
23,927
(5,064)
27,643
8,775
20,851
(5,073)
24,553
8,435
20,928
(6,098)
23,265
696
5,281
149
(142)
33,627
182,694
482
5,415
171
(143)
30,478
186,847
434
5,970
87
(128)
29,628
177,222
11.8
15.1
3.3
18.4
11.2
13.1
3.2
16.3
11.0
13.1
3.6
16.7
The Group’s capital adequacy ratio increased from 16.3% in the previous quarter to 18.4% due to the S$2.5 billion
preference share issue in November 2010 and a reduction in risk weighted assets.
UNREALISED VALUATION SURPLUS/(LOSSES)
($m)
Properties
Financial investments
Total
31 Dec 2010
30 Sept 2010
31 Dec 2009
507
26
533
482
141
623
511
119
630
The amount of unrealised valuation surplus declined $90 million to $533 million in fourth quarter 2010 due to lower valuations
of financial investments.
22
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
Audited Consolidated Income Statement
In $ millions
4th Qtr
20101/
4th Qtr +/(-)
20091/
%
3rd Qtr +/(-)
20101/
%
Year
2010
Year +/(-)
2009
%
Income
Interest income
Interest expense
Net interest income
Net fee and commission income
Net trading income
Net income/(loss) from financial instruments designated at fair value
Net income from financial investments
Other income
1,461
355
1,106
358
154
10
39
62
1,437
310
1,127
358
179
(124)
3
29
2
15
(2)
(14)
NM
>100
>100
1,457
378
1,079
340
235
(12)
123
44
(6)
3
5
(34)
NM
(68)
41
5,699
1,381
4,318
1,397
915
(20)
310
146
6,114 (7)
1,659 (17)
4,455 (3)
1,394
700
31
(267)
93
254
22
67 >100
Total income
1,729
1,572
10
1,809
(4)
7,066
6,603
7
Expenses
Employee benefits
Depreciation of properties and other fixed assets
Other expenses
Goodwill charges
Allowances for credit and other losses
362
56
362
157
313
48
339
384
16
17
7
(59)
360
43
323
195
1
30
12
(19)
1,422
193
1,310
1,018
911
1,292
195
1,117
1,552
10
(1)
17
NM
(41)
Total expenses
937
1,084
(14)
921
2
4,854
4,156
17
Profit/(Loss)
Share of profits of associates
Profit/(Loss) before tax
792
24
816
488
6
494
62
>100
65
888
31
919
(11)
(23)
(11)
2,212
102
2,314
2,447
66
2,513
(10)
55
(8)
Income tax expense
Net profit/(loss)
71
745
(47)
541
NM
38
146
773
(51)
(4)
454
1,860
285
2,228
59
(17)
678
67
745
493
48
541
38
40
38
722
51
773
(6)
31
(4)
1,632
228
1,860
2,041
187
2,228
(20)
22
(17)
Attributable to:
Shareholders
Non-controlling interests
Notes:
1/ Unaudited
NM Not Meaningful
Audited Consolidated Statement of Comprehensive Income
In $ millions
Net profit/(loss)
Other comprehensive income:
Foreign currency translation differences for foreign operations
Share of other comprehensive income of associates
Available-for-sale financial assets
Net valuation taken to equity
Transferred to income statement on sale
Tax on items taken directly to or transferred from equity
Other comprehensive income, net of tax
Total comprehensive income
Attributable to:
Shareholders
Non-controlling interests
+/(-)
%
3rd Qtr
1/
2010
+/(-)
%
Year
2010
Year +/(-)
2009
%
38
773
(4)
1,860
2,228
(17)
(97)
3
(4) (>100)
2
50
(109)
5
11
(40)
(187)
12
31
18
NM
(33)
(439)
(42)
26
(549)
32
NM
(31)
(35)
(15)
NM
(16) (>100)
474
(131)
(31)
208
NM
68
NM
NM
598
(315)
(28)
80
932
(312)
(100)
569
(36)
(1)
72
(86)
4th Qtr 4th Qtr
1/
1/
2010
2009
745
541
196
525
(63)
981
(80)
1,940
2,797
(31)
159
37
196
490
35
525
(68)
6
(63)
1,010
(29)
981
(84)
N
Incorporated in the Republic of Singapore
Company Registration Number: 199901152M
To: Shareholders
The DBS Group Holdings Ltd (“DBSH” or “the Company”) Board of Directors report audited financial
results for the year ended 31 December 2010.
With effect from the second half of 2010, DBS has reverted to semi-annual dividend payments. For the
financial year ended 31 December, the Directors have recommended a final one-tier tax exempt dividend
of 2 cents for each DBSH non-voting convertible preference share (“CPS”) and each DBSH non-voting
redeemable CPS, and a final one-tier tax exempt dividend of 28 cents for each DBSH ordinary share.
Details of these proposed dividends, along with interim ones paid during the course of the financial year,
are as follows:
In $ millions
2010
2009
DBSH Non-voting Convertible Preference Share (“CPS”)
Interim one-tier tax exempt dividend* of 28.0 cents (2009 : 30.0 cents )
Final one-tier tax exempt dividend of 2.0 cents (2009: nil cents)
DBSH Non-voting redeemable CPS
Interim one-tier tax exempt dividend* of 28.0 cents (2009 : 30.0 cents )
Final one-tier tax exempt dividend of 2.0 cents (2009: nil cents)
DBSH Ordinary share
Interim one-tier tax exempt dividend* of 28.0 cents (2009 : 42.0 cents )
Final one-tier tax exempt dividend of 28.0 cents (2009 : 14.0 cents )
(a)
(a)
(a)
-
28
30
2
-
638
959
646
320
1,284
1,279
* Interim dividends were paid to entitled shareholders during the year
(a)
Amounts under $500,000
The 2010 final one-tier tax exempt dividend, to which the DBSH Scrip Dividend Scheme will be
applicable, will be subject to shareholders’ approval at the Annual General Meeting to be held on 28
April 2011. The DBSH shares will be quoted ex-dividend on 12 May 2011. Notice is hereby given that
the Share Transfer Books and Register of Members of the Company will be closed on 18 May 2011.
Duly completed transfers received by the Company's Registrar, Tricor Barbinder Share Registration
Services of 8 Cross Street #11-00 PWC Building, Singapore 048424 up to 5.00 p.m. on 16 May 2011
will be registered to determine shareholders' entitlement to the 2010 final one-tier tax exempt dividend.
The issue price for new shares to be allotted to shareholders who have elected to receive the final
dividend in scrip shall be the average of the last dealt prices of each DBSH ordinary share on the SGXST for each of 12, 13 and 16 May 2011, to which a discount of 5% shall be applied.
The payment date for cash dividends / crediting of shares is expected to be in early July 2011. In
respect of ordinary shares in the securities accounts with The Central Depository (Pte) Limited (“CDP”),
the 2010 final one-tier tax exempt dividend will be paid by DBSH to CDP, which will in turn distribute the
dividend entitlements to shareholders, either in cash or by crediting the securities accounts of
shareholders with the relevant shares.
By order of the Board
Linda Hoon
Group Secretary
10 February 2011
Singapore
More information on the above announcement is available at www.dbs.com/investor
Performance Summary
Financial Results for the Fourth Quarter ended
31 December 2010 (Unaudited) and
For the Year 2010 (Audited)
DBS Group Holdings Ltd
Incorporated in the Republic of Singapore
Company Registration Number: 199901152M
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
Contents
Overview
Quarterly Breakdown
Net Interest Income
Net Fee and Commission Income
Other Non-Interest Income
Expenses
Allowances for Credit and Other Losses
Performance by Business Segments
Performance by Geography
Customer Loans
Non-Performing Assets and Loss Allowance Coverage
Funding Sources
Customer Deposits
Other Borrowings & Liabilities
Value at Risk and Trading Income
Capital Adequacy
Unrealised Valuation Surplus/(Losses)
Audited Consolidated Income Statement
Audited Consolidated Statement of Comprehensive Income
Audited Balance Sheets
Audited Consolidated Statement of Changes in Equity
Audited Statement of Changes in Equity
Audited Consolidated Cash Flow Statement
Additional Information
Issuance of Ordinary Shares
Adoption of New or Revised FRS and INT FRS
Disclosure on Certain Financial Instruments
Other Matters / Subsequent Events
Confirmation by the Board
Page
2
4
5
7
7
8
8
9
12
15
16
19
20
20
21
22
22
23
23
24
25
26
27
28
28
29
30
31
1
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
OVERVIEW
DBS Group Holdings Ltd (“DBSH”) prepares its consolidated DBSH Group (“Group”) financial statements in accordance with
Singapore Financial Reporting Standard (“FRS”), as modified by the requirements of Notice to Banks No. 612 “Credit Files,
Grading and Provisioning” issued by the Monetary Authority of Singapore. The accounting policies and methods of
computation applied for the current financial periods are consistent with those applied for the financial year ended 31
December 2009, with the exception of the adoption of new or revised FRS and Interpretations to FRS (“INT FRS”).
On 1 January 2010, the Group adopted the following new or revised FRS and INT FRS that are issued by the Accounting
Standard Council (ASC), and are relevant for the Group.
•
FRS 27 Consolidated and Separate Financial Statements
•
FRS 103 Business Combinations
•
FRS 39 (Amendments) Financial Instruments: Recognition and Measurement
- Eligible Hedged Items
- Embedded Derivatives
•
FRS 102 (Amendments) Share-Based Payment – Group Cash-settled Share-based Payment Transactions
•
INT FRS 109 (Amendments): Reassessment of Embedded Derivatives
•
INT FRS 117: Distributions of Non-cash Assets to Owners
•
Improvements to FRSs
Refer to page 28 for more information.
4th Qtr
2010
4th Qtr
2009
%
chg
3rd Qtr
2010
%
chg
Year
2010
Year
2009
%
chg
1,106
358
265
1,729
780
949
157
816
678
-
1,127
358
87
1,572
700
872
384
494
493
-
(2)
>100
10
11
9
(59)
65
38
-
1,079
340
390
1,809
726
1,083
195
919
722
-
3
5
(32)
(4)
7
(12)
(19)
(11)
(6)
-
4,318
1,397
1,351
7,066
2,925
4,141
911
3,332
2,650
(1,018)
4,455
1,394
754
6,603
2,604
3,999
1,529
2,536
2,064
-
(3)
79
7
12
4
(40)
31
28
NM
-
-
-
-
-
-
(23)
NM
678
493
38
722
(6)
1,632
2,041
(20)
Selected balance sheet items ($m)
Customer loans 2/
3/
Interbank assets
Total assets
152,094
23,298
283,710
130,583
24,189
258,644
16
(4)
10
147,785
25,820
279,436
3
(10)
2
152,094
23,298
283,710
130,583
24,189
258,644
16
(4)
10
Customer deposits 4/
Total liabilities
Shareholders’ funds
193,692
250,608
26,599
183,432
229,145
25,373
6
9
5
185,211
248,969
26,424
5
1
1
193,692
250,608
26,599
183,432
229,145
25,373
6
9
5
1.79
36.0
45.1
0.96
10.22
78.5
1.9
2.02
28.3
44.5
0.76
7.76
71.2
2.9
1.80
40.4
40.1
1.04
11.06
79.8
2.1
1.84
38.9
41.4
0.98
10.20
78.5
1.9
2.02
32.5
39.4
0.80
8.44
71.2
2.9
25
116
33
43
85
11.8
15.1
18.4
11.0
13.1
16.7
11.2
13.1
16.3
11.8
15.1
18.4
11.0
13.1
16.7
Selected income statement items ($m)
Net interest income
Net fee and commission income
Other non-interest income
Total income
Expenses
Profit before allowances
Allowances for credit and other losses
Profit before tax
Net profit
Goodwill charges
One-time items 1/
Net profit/(loss) including goodwill charges
and one-time items
Key financial ratios (%) (excluding
5/
goodwill charges and one-time items)
Net interest margin
Non-interest/total income
Cost/income ratio
Return on assets
6/
Return on equity
Loan/deposit ratio
NPL ratio
Specific allowances (loans)/average loans
(bp)
Core Tier 1 capital adequacy ratio
Tier 1 capital adequacy ratio
Total capital adequacy ratio
2
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
4th Qtr
2010
4th Qtr
2009
3rd Qtr
2010
Year
2010
Year
2009
1.16
0.85
1.25
1.15
0.91
1.16
11.25
0.85
10.85
1.25
11.18
0.70
11.25
0.90
10.85
1.13
0.83
1.20
1.11
0.88
1.13
11.04
0.83
10.65
1.20
10.97
0.68
11.04
0.87
10.65
Per share data ($)
Per basic share
– earnings excluding one-time items and
goodwill charges
– earnings
6/
– net book value
Per diluted share
– earnings excluding one-time items and
goodwill charges
– earnings
6/
– net book value
Notes:
1/ One-time items include an impairment charge for a Thai investment
2/ Includes customer loans classified as financial assets at fair value through profit or loss on the balance sheet
3/ Includes interbank assets classified as financial assets at fair value through profit or loss on the balance sheet
4/ Includes customer deposits classified as financial liabilities at fair value through profit or loss on the balance sheet
5/ Return on assets, return on equity, specific allowances (loan)/average loan and per share data for the quarters are computed on an annualised basis
6/ Non-controlling interests are not included as equity in the computation of net book value and return on equity
NM Not Meaningful
Fourth-quarter net profit rose 38% from a year ago to $678
million. Similar to the earlier quarters of 2010, non-interest
income was higher and allowances were lower than the
year-ago period.
Net profit was 6% lower than the previous quarter as net
trading income fell in line with quieter treasury markets
during the year-end and net income from financial
investments declined. Business volume trends continued
to be healthy.
Net interest income rose 3% from the previous quarter to
$1.11 billion. Loans grew 3% from corporate borrowing
across the region and housing loan drawdowns in
Singapore. Net interest margin was stable at 1.79%.
Non-interest income fell 15% from the previous quarter to
$623 million. Net fee income rose from higher investment
banking and wealth management revenues, but the impact
was more than offset by declines in net trading income
and net income on financial investments. Customer
revenues continued to account for a significant portion of
net trading income.
Expenses rose 7% from the previous quarter to $780
million due to higher brand marketing costs and
infrastructure investments.
The non-performing loan rate improved from 2.1% in the
previous quarter to 1.9%. General and specific
allowances of $157 million were set aside, 19% below
the previous quarter. Allowance coverage rose to 100%
from 97%.
For the full-year, net profit (before one-time items) rose
28% to $2.65 billion from higher customer-driven noninterest income and a decline in allowances.
Return on equity was 10.2% for the fourth quarter as
well as for the full year. DBS remained well capitalised
with total capital adequacy ratio at 18.4%, tier -1 at
15.1% and core tier-1 at 11.8%.
3
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
QUARTERLY BREAKDOWN
($m)
1st Qtr
2nd Qtr
3rd Qtr
4th Qtr
Full Year
1,076
1,066
(1)
1,112
1,067
(4)
1,140
1,079
(5)
1,127
1,106
(2)
4,455
4,318
(3)
586
647
10
680
748
10
437
730
67
445
623
40
2,148
2,748
28
1,662
1,713
3
1,792
1,815
1
1,577
1,809
15
1,572
1,729
10
6,603
7,066
7
Expenses
2009
2010
% chg
638
702
10
631
717
14
635
726
14
700
780
11
2,604
2,925
12
Allowances for credit and other losses
2009
2010
% chg
414
355
(14)
466
204
(56)
265
195
(26)
384
157
(59)
1,529
911
(40)
Profit before tax
2009
2010
% chg
630
678
8
708
919
30
704
919
31
494
816
65
2,536
3,332
31
Net profit
2009
2010
% chg
456
532
17
552
718
30
563
722
28
493
678
38
2,064
2,650
28
Add: One-time items and
goodwill charges 1/
2009
2010
% chg
(23)
NM
(1,018)
NM
-
-
(23)
(1,018)
(>100)
552
(300)
NM
563
722
28
493
678
38
2,041
1,632
(20)
Net interest income
2009
2010
% chg
Non interest income
2009
2010
% chg
Total income
2009
2010
% chg
Net profit including one-time items and goodwill charges
2009
433
2010
532
% chg
23
Note:
1/ One-time items include impairment charges for Thai investment
Revenues for all quarters were higher than the year-ago
period due to gains in non-interest income. Net interest
income was marginally lower as a decline in interest
margins offset the benefit of loan growth.
Expenses rose at a faster pace than revenues for the
second half of the year as headcount and investment costs
increased. The impact of cost increases was offset by a
decline in allowances. Profit before tax as well as net profit
was higher for all four quarters. The third quarter’s net profit
was a quarterly record.
4
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
NET INTEREST INCOME
Average balance
sheet
4th Qtr 2010
Average
Average
balance Interest
rate
($m)
($m)
(%)
4th Qtr 2009
Average
Average
balance Interest
rate
($m)
($m)
(%)
3rd Qtr 2010
Average
Average
balance Interest
rate
($m)
($m)
(%)
Interest-bearing
assets
Customer loans
Interbank assets
Securities
Total
149,104
46,548
48,851
244,503
1,011
105
345
1,461
2.69
0.90
2.79
2.37
128,152
41,697
51,613
221,462
968
82
387
1,437
3.00
0.78
2.97
2.57
145,902
40,880
51,010
237,792
1,009
97
351
1,457
2.74
0.95
2.73
2.43
Interest-bearing
liabilities
Customer deposits
Other borrowings
Total
189,502
34,624
224,126
245
110
355
0.51
1.26
0.63
180,701
22,859
203,560
219
91
310
0.48
1.58
0.60
184,815
33,766
218,581
269
109
378
0.58
1.28
0.69
1,106
1.79
1,127
2.02
1,079
1.80
Net interest
1/
income/margin
Year 2010
Average balance
sheet
Average
balance
($m)
Year 2009
Average Average
Interest
rate balance
($m)
(%)
($m)
Interest
($m)
Average
rate
(%)
Interest-bearing
assets
Customer loans
Interbank assets
Securities
Total
141,245
43,190
50,272
234,707
3,937
358
1,404
5,699
2.79
0.83
2.79
2.43
127,832
41,782
51,031
220,645
4,075
378
1,661
6,114
3.20
0.91
3.26
2.78
Interest-bearing
liabilities
Customer deposits
Other borrowings
Total
184,792
30,834
215,626
970
411
1,381
0.53
1.33
0.64
178,064
26,272
204,336
1,131
528
1,659
0.64
2.02
0.81
4,318
1.84
4,455
2.02
Net interest
1/
income/margin
Note:
1/ Net interest margin is net interest income expressed as a percentage of average interest-earning assets
Net interest income rose 3% from the previous quarter to
$1.11 billion.
Net interest margin was stable at 1.79%. While customer
loan yields were lower, deposit costs also declined, partly
the result of a shift in the deposit mix towards lower-yielding
currencies.
For the full year, net interest income fell 3% to $4.32 billion.
Net interest margins declined from 2.02% to 1.84% due to a
soft interest rate environment and normalising credit
spreads. The lower margins offset the benefit of higher
asset volumes and an improved asset mix.
5
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
4th Qtr 2010 versus 4th Qtr 2009
Volume and rate analysis ($m)
Increase/(decrease) due to change in
4th Qtr 2010 versus 3rd Qtr 2010
Volume
Rate
Net
change
Customer loans
Interbank assets
Securities
158
10
(20)
(115)
13
(22)
43
23
(42)
Total
148
(124)
10
31
41
107
Volume
Rate
Net
change
22
13
(20)
(5)
2
8
24
(14)
21
8
(17)
(6)
4
16
(12)
4
26
19
45
7
3
10
(31)
(2)
(33)
(24)
1
(23)
(128)
(21)
11
16
27
Interest income
Interest expense
Customer deposits
Other borrowings
Total
Net impact on interest income
Due to change in number of days
Net Interest Income
-
-
(21)
27
Year 2010 versus Year 2009
Volume and rate analysis ($m)
Increase/(decrease) due to change in
Volume
Rate
Net
change
426
13
(24)
415
(564)
(33)
(233)
(830)
(138)
(20)
(257)
(415)
42
39
81
(203)
(156)
(359)
(161)
(117)
(278)
334
(471)
(137)
Interest income
Customer loans
Interbank assets
Securities
Total
Interest expense
Customer deposits
Other borrowings
Total
Net impact on interest income
Due to change in number of days
Net Interest Income
(137)
6
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
NET FEE AND COMMISSION INCOME
($m)
Stockbroking
Investment banking
Trade and remittances
Loan related
Guarantees
Deposit related
Credit card
Fund management
Wealth management
Others
Total
4th Qtr
2010
4th Qtr
2009
% chg
3rd Qtr
2010
% chg
Year
2010
Year
2009
% chg
50
60
56
52
16
23
40
6
44
11
358
41
59
55
85
14
21
36
4
30
13
358
22
2
2
(39)
14
10
11
50
47
(15)
-
45
38
55
80
14
20
37
5
31
15
340
11
58
2
(35)
14
15
8
20
42
(27)
5
179
154
227
333
59
85
149
22
136
53
1,397
170
146
244
375
57
84
143
20
101
54
1,394
5
5
(7)
(11)
4
1
4
10
35
(2)
-
Net fee and commission income rose by 5% from the
previous quarter to $358 million. The gains were broadbased and led by higher investment banking activity and
improved demand for unit trusts and bancassurance
products. These gains were partly offset by a decline in
loan-related income.
Net fee and commission income for year was unchanged at
$1.40 billion. An improvement in wealth management
revenues was offset by lower margins in trade and
remittances and by a decline in loan-related fees.
OTHER NON-INTEREST INCOME
($m)
4th Qtr
2010
4th Qtr
2009
% chg
3rd Qtr
2010
% chg
Year
2010
Year
2009
% chg
Net trading income
Net (loss)/income from financial
instruments designated at fair value
Net income on financial
investments
Net gain on fixed assets
Others (include rental income)
154
179
(14)
235
(34)
915
700
31
10
(124)
NM
(12)
NM
(20)
(267)
93
39
3
>100
123
(68)
310
254
22
52
10
13
16
>100
(38)
34
10
53
-
103
43
13
54
>100
(20)
Total
265
87
>100
390
(32)
1,351
754
79
Note:
NM Not Meaningful
Net trading income (including net income from financial
instruments designated at fair value) fell 26% from the
previous quarter to $164 million. Customer revenues
continued to account for a substantial portion of net
trading income.
Net income on financial investments also declined from
the previous quarter due to fewer profit-taking
opportunities.
For the full year, other non-interest income rose 79% to
$1.35 billion as net trading income, net income on
financial investments and net gain on fixed assets rose.
7
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
EXPENSES
($m)
4th Qtr
2010
4th Qtr
2009
% chg
3rd Qtr
2010
% chg
Year
2010
Year
2009
% chg
Staff
Occupancy
Computerisation
Revenue-related
Others
Total
Staff headcount at period-end
362
67
164
37
150
780
15,847
313
56
143
39
149
700
14,033
16
20
15
(5)
1
11
13
360
67
145
33
121
726
15,206
1
0
13
12
24
7
4
1,422
269
569
136
529
2,925
15,847
1,292
265
473
132
442
2,604
14,033
10
2
20
3
20
12
13
56
1
48
1
17
-
43
1
30
-
193
3
195
3
1
-
-
1
-
2
-
6
5
-
Included in the above table were:
Depreciation of properties and other fixed
assets
Directors’ fees
Audit fees payable
Expenses grew 7% from the previous quarter to $780
million as brand marketing costs and computerisation
costs rose. The cost-income ratio increased to 45%.
For the full year, costs rose 12% to $2.93 billion as
headcount increased and infrastructure was rolled out to
support higher business volumes and initiatives to
develop growth opportunities.
ALLOWANCES FOR CREDIT AND OTHER LOSSES
($m)
4th Qtr
2010
4th Qtr
2009
% chg
3rd Qtr
2010
% chg
Year
2010
General allowances (GP)
44
(225)
NM
39
13
232
154
51
Specific allowances (SP) for loans1/
Singapore
Hong Kong
Rest of Greater China
97
8
3
(2)
387
8
15
22
(75)
(80)
NM
125
(1)
8
17
(22)
NM
(63)
NM
614
18
14
25
1,113
149
185
54
(45)
(88)
(92)
(54)
South and South-east Asia
Rest of the world
20
68
12
330
67
(79)
15
86
33
(21)
47
510
31
694
52
(27)
Specific allowances (SP) for securities,
properties and other assets 2/
16
222
(93)
31
(48)
65
262
(75)
157
384
(59)
195
(19)
911
1,529
(40)
Total
Year % chg
2009
Notes:
1/ Specific allowances for loans are classified according to where the borrower is incorporated. Historical comparatives have been restated to conform to the current year presentation
2/ Excludes one-time items
Specific allowances for loans fell to $97 million (25 basis
points of loans) from $125 million (33 basis points) in the
previous quarter. Most of the charges were for existing
NPLs. General allowances rose slightly to $44 million.
For the full year, total allowances fell 40% to $911
million as specific allowances for loans fell 45% to $614
million in line with improved asset quality.
8
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
PERFORMANCE BY BUSINESS SEGMENTS 1/
($m)
Institutional
Banking
Consumer/
Private
Banking
Selected income items
4th Qtr 2010
Net interest income
Non-interest income
Total income
Expenses
Allowances for credit and other losses
Share of profits of associates
Profit before tax
Income tax expense
Net profit
3rd Qtr 2010
Net interest income
Non-interest income
Total income
Expenses
Allowances for credit and other losses
Share of profits of associates
Profit before tax
Income tax expense
Net profit
4th Qtr 2009
Net interest income
Non-interest income
Total income
Expenses
Allowances for credit and other losses
Share of profits of associates
Profit before tax
Income tax expense
Net profit
Year 2010 2/
Net interest income
Non-interest income
Total income
Expenses
Allowances for credit and other losses
Share of profits of associates
Profit before tax
Income tax expense
Net profit
Treasury
Others
Total
348
513
233
12
178
372
(66)
139
1,106
623
526
885
167
151
1,729
401
5
331
160
101
(4)
(53)
(4)
780
157
-
5
-
19
24
120
399
70
227
816
17
68
13
(27)
71
103
341
57
177
678
338
505
210
26
1,079
164
399
125
42
730
502
904
335
68
1,809
357
15
282
149
96
(3)
(9)
34
726
195
-
6
-
25
31
130
479
242
68
919
20
78
34
14
146
110
410
208
(6)
722
369
481
278
(1)
1,127
156
323
(72)
38
445
525
804
206
37
1,572
387
(9)
269
417
62
(43)
(18)
19
700
384
-
9
-
(3)
6
147
127
187
33
494
23
(9)
37
(98)
(47)
124
146
150
73
493
1,398
1,995
840
85
4,318
667
1,518
393
170
2,748
2,065
3,513
1,233
255
7,066
1,471
55
1,119
812
368
(2)
(33)
46
2,925
911
-
25
-
77
102
539
1,607
867
319
3,332
81
274
134
(35)
454
458
1,360
733
99
2,650
9
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
($m)
Consumer/
Private
Banking
Year 2009 2/
Net interest income
Non-interest income
Total income
Expenses
Allowances for credit and other losses
Share of profits of associates
Profit before tax
Income tax expense
Net profit
Selected balance sheet and other
items 3/
31 Dec 2010
Total assets before goodwill
Goodwill on consolidation
Total assets
Total liabilities
Capital expenditure for 4th Qtr 2010
Depreciation for 4th Qtr 2010 3/
30 Sept 2010
Total assets before goodwill
Goodwill on consolidation
Total assets
Total liabilities
Capital expenditure for 3rd Qtr 2010
Depreciation for 3rd Qtr 2010 3/
31 Dec 2009
Total assets before goodwill
Goodwill on consolidation
Total assets
Total liabilities
Capital expenditure for 4th Qtr 2009
Depreciation for 4th Qtr 2009 3/
Institutional
Banking
Treasury
Others
Total
1,399
1,844
1,223
(11)
4,455
609
1,328
26
185
2,148
2,008
3,172
1,249
174
6,603
1,245
82
964
1,118
324
7
71
322
2,604
1,529
-
28
-
38
66
681
1,118
918
(181)
2,536
109
197
195
(216)
285
572
974
723
(205)
2,064
51,328
118,572
98,735
10,273
117,529
22
11
80,559
16
6
42,584
8
2
9,936
44
37
278,908
4,802
283,710
250,608
90
56
49,706
115,390
99,611
9,927
113,944
9
11
74,842
2
4
50,908
3
9,275
22
25
45,094
100,649
97,959
9,095
115,194
14
14
69,084
5
6
31,262
3
2
13,605
37
26
274,634
4,802
279,436
248,969
33
43
252,797
5,847
258,644
229,145
59
48
Notes:
1/ With effect from 1 January 2010, the Group has adopted a revised capital benefit and fund transfer policy. The business segments have also been reaggregated following a review.
Comparative figures have been restated to conform to the current year presentation
2/ Excludes goodwill charges and one-time items
3/ Amounts for each business segment are shown before allocation of centralised cost
4/ Refer to sections on Customer Loans and Non-Performing Assets and Loss Allowance Coverage for more information on business segments
10
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
The business segment results are prepared based on
the Group’s internal management reporting which
reflects the organisation management structure. As the
activities of the Group are highly integrated, internal
allocation has been made in preparing the segment
information. Amounts for each business segment are
shown after the allocation of certain centralised costs,
funding income and the application of transfer pricing,
where appropriate. Transactions between segments are
recorded within the segment as if they are third party
transactions and are eliminated on consolidation. During
the quarter, no one group of related customers
generated more than 10% of the Group’s revenues.
The external presentation of the business segment
results has been revised from first-quarter 2010 to better
reflect internal management reporting. In addition, the
Group adopted a revised capital benefit and fund
transfer policy with effect from 1 January 2010.
Comparative figures have been restated to conform to
the current presentation.
The various business segments are described below:
Consumer/ Private Banking
Consumer/ Private Banking provides individual customers
with a diverse range of banking and related financial
services. The products and services available to customers
include current and savings accounts, fixed deposits, loans
and home finance, cards, payments, investment and
insurance products.
Compared to the previous quarter, net interest income
was higher from loan growth, which more than offset
lower housing loan margins. Non-interest income
benefited from higher wealth management and credit
card revenues. Expenses were higher due to higher staff
costs arising from headcount increases as well as
investments in infrastructure. Specific allowances for
private banking were lower.
For the full year, net interest income was unchanged as
higher loan volumes were offset by lower housing loan
margins. Non-interest income benefited from better
wealth management revenues. The increase in expenses
was due to compensation to customers who had bought
Constellation notes in Hong Kong, as well as higher staff
and infrastructure costs. Specific allowances declined for
unsecured loan and private banking clients, which more
than offset an increase in general allowances.
Institutional Banking
Institutional Banking provides financial services and
products to institutional clients including non bank
financial institutions, government linked companies,
large corporates and small and medium-sized
businesses. The business focus is to broaden and
deepen the financial relationship with clients. The
products and services available to customers include long
and short term credit facilities ranging from specialised
lending such as asset financing, project financing and real
estate financing to overdraft, trade, receivables financing
and structured trade; cash management and deposit;
treasury and markets; corporate finance and advisory
banking services for mergers and acquisitions, capital
raising through debt and equity markets, capital
restructuring, syndicated finance, securities and fiduciary
services and private equity. Institutional Banking also
provides equity services through DBS Vickers Securities
(DBSV). DBSV offers a wide range of services to retail
and corporate customers including research, sales and
trading, share placement, nominees and securities
custodian services and distribution of primary and
secondary issues.
Net interest income rose from the previous quarter as
higher loan volumes were partially offset by lower margins.
Non-interest income fell as lower loan-related and treasury
product sales revenues were partially offset by higher
investment banking revenue. Expenses rose due to higher
infrastructure investments. General allowances were
higher.
For the full year, net interest income rose with higher loan
volumes, while non-interest income growth was driven by
treasury product sales. Both staff and non-staff costs were
higher. Specific allowances declined with asset quality
improvements while general allowances rose in line with
stronger loan growth.
Treasury
Treasury provides treasury services to corporations,
institutional and private investors, financial institutions and
other market participants. It is primarily involved in sales,
structuring, market making and trading across a broad
range of financial products including foreign exchange,
interest rate, debt, credit, equity and other structured
derivatives. Income from these financial products and
services offered to the customer of other business
segments, such as Consumer/Private Banking and
Institutional Banking, is reflected in the respective
segments. Treasury is also responsible for facilitating the
execution of Group’s asset and liability interest rate
positions and management of the investment of the
Group’s excess liquidity and shareholders’ funds.
Treasury’s total revenues were lower than the previous
quarter due to quieter year-end markets. For the full year,
total revenues were little changed.
Others
Others encompasses a range of activities from corporate
decisions and income and expenses not attributed to other
business segments.
11
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
PERFORMANCE BY GEOGRAPHY
($m)
S’pore
Hong
Kong
Rest of
Greater
China
South
and
Southeast Asia
Rest of
world
Total
Selected income items
4th Qtr 2010
Net interest income
Non-interest income
Total income
Expenses
Allowances for credit and other losses
Share of profits of associates
Profit before tax
Income tax expense
Net profit
704
417
1,121
445
111
3
568
30
471
192
157
349
177
16
156
12
144
88
4
92
98
7
5
(8)
7
(15)
68
33
101
45
13
16
59
7
52
54
12
66
15
10
41
15
26
1,106
623
1,729
780
157
24
816
71
678
3rd Qtr 2010
Net interest income
Non-interest income
Total income
Expenses
Allowances for credit and other losses
Share of profits of associates
Profit before tax
Income tax expense
Net profit
679
444
1,123
424
115
2
586
105
430
191
195
386
147
18
221
31
190
84
39
123
80
21
4
26
6
20
68
35
103
57
41
25
30
(4)
34
57
17
74
18
56
8
48
1,079
730
1,809
726
195
31
919
146
722
4th Qtr 2009
Net interest income
Non-interest income
Total income
Expenses
Allowances for credit and other losses
Share of profits of associates
Profit before tax
Income tax expense
Net profit
704
250
954
410
209
3
338
(45)
335
216
126
342
154
37
151
23
128
75
13
88
81
35
6
(22)
(9)
(13)
79
26
105
46
15
(3)
41
6
35
53
30
83
9
88
(14)
(22)
8
1,127
445
1,572
700
384
6
494
(47)
493
Year 2010 1/
Net interest income
Non-interest income
Total income
Expenses
Allowances for credit and other losses
Share of profits of associates
Profit before tax
Income tax expense
Net profit
2,683
1,743
4,426
1,611
652
10
2,173
257
1,688
783
682
1,465
720
73
672
93
579
327
99
426
325
52
20
69
22
47
283
174
457
207
79
72
243
40
203
242
50
292
62
55
175
42
133
4,318
2,748
7,066
2,925
911
102
3,332
454
2,650
12
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
($m)
S’pore
Year 2009 1/
Net interest income
Non-interest income
Total income
Expenses
Allowances for credit and other losses
Share of profits of associates
Profit before tax
Income tax expense
Net profit
Hong
Kong
Rest of
Greater
China
South
and
Southeast Asia
Rest of
world
Total
2,738
1,253
3,991
1,512
1,034
16
1,461
88
1,186
888
478
1,366
600
210
556
92
464
302
107
409
270
74
17
82
14
68
326
175
501
172
69
33
293
67
226
201
135
336
50
142
144
24
120
4,455
2,148
6,603
2,604
1,529
66
2,536
285
2,064
Selected balance sheet items
31 Dec 2010
Total assets before goodwill
Goodwill on consolidation
Total assets
Non-current assets 2/
Gross customer loans
179,813
4,802
184,615
1,623
91,128
52,489
52,489
406
36,224
21,033
21,033
129
12,208
13,710
13,710
36
9,121
11,863
11,863
2
6,041
278,908
4,802
283,710
2,196
154,722
30 Sept 2010
Total assets before goodwill
Goodwill on consolidation
Total assets
Non-current assets 2/
Gross customer loans
176,623
4,802
181,425
1,587
86,521
53,149
53,149
458
37,036
18,861
18,861
126
11,541
14,115
14,115
37
9,436
11,886
11,886
2
6,000
274,634
4,802
279,436
2,210
150,534
31 Dec 2009
Total assets before goodwill
Goodwill on consolidation
Total assets
Non-current assets 2/
Gross customer loans
165,652
5,847
171,499
1,485
75,117
47,653
47,653
530
33,431
14,362
14,362
142
10,252
12,743
12,743
46
8,058
12,387
12,387
1
6,562
252,797
5,847
258,644
2,204
133,420
Notes:
1/ Allowances for credit and other losses and profits exclude goodwill charges and one-time items
2/ Includes investment in associates, properties and other fixed assets, and investment properties
13
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
The performance by geography is classified based on the
location in which income and assets are recorded.
Singapore
Net profit rose 10% from the previous quarter to $471
million. The tax rate declined due to a write-back of
previous accruals.
Net interest income rose 4% from the previous quarter in
line with higher corporate and housing loan volumes.
Non-interest income declined 6% due to lower trading
gains and loan-related fees, which were partially offset by
higher investment banking and wealth management
revenues.
Expenses rose 5% as advertising and infrastructure
investments rose. Allowances were stable.
For the full year, net profit rose 42% to $1.69 billion from
better treasury product sales revenues and lower specific
allowances. These improvements were partially offset by
lower interest margins and higher expenses. There was
also a larger tax-writeback in 2009.
Hong Kong
The fourth quarter’s results incorporate an appreciation of
the Singapore dollar against the Hong Kong dollar of 3%
from the previous quarter and 7% from a year ago.
Net profit fell 24% from the previous quarter to $144 million
as non-interest income declined and expenses rose.
Net interest income was stable from the previous quarter.
Loan volumes were little changed while deposits grew 6%
in local currency terms. Net interest margin fell seven basis
points to 1.49% as interbank rates declined and the asset
mix had a larger proportion of interbank assets.
Non-interest income fell 19% from the previous quarter as
loan-related fees and trading income declined, which were
partially offset by better wealth management revenues and
higher gains from fixed asset sales.
Expenses rose 20% due to higher advertising,
infrastructure and staff costs. Allowances declined 11% as
general allowances fell. Specific allowances were stable.
For the full year, net profit rose 25% to $579 million as
non-interest income benefited from stronger treasury
product sales and as specific allowances declined. These
gains were partially offset by lower interest margins and
an increase in staff and infrastructure investment costs.
14
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
CUSTOMER LOANS
1/
($m)
31 Dec 2010
30 Sept 2010
31 Dec 2009
154,722
150,534
133,420
General allowances
Net total
1,152
1,476
152,094
1,300
1,449
147,785
1,512
1,325
130,583
By business unit 2/
Consumer/ Private Banking
Institutional Banking
Others
Total (Gross)
50,256
103,219
1,247
154,722
49,108
100,214
1,212
150,534
44,162
88,503
755
133,420
By geography 3/
Singapore
Hong Kong
Rest of Greater China
South and South-east Asia
Rest of the world
Total (Gross)
74,595
36,688
13,495
13,976
15,968
154,722
72,997
36,541
11,322
13,677
15,997
150,534
61,713
32,999
11,211
11,726
15,771
133,420
By industry
Manufacturing
Building and construction
Housing loans
General commerce
Transportation, storage & communications
Financial institutions, investment & holding companies
Professionals & private individuals (except housing loans)
Others
Total (Gross)
19,217
21,385
38,676
16,732
14,378
18,517
11,142
14,675
154,722
17,814
21,194
38,030
15,053
13,714
19,868
10,652
14,209
150,534
16,239
18,433
33,120
13,335
12,277
16,710
10,873
12,433
133,420
67,439
30,478
38,094
18,711
154,722
64,908
31,789
35,755
18,082
150,534
56,712
30,274
29,449
16,985
133,420
Gross
Less:
Specific allowances
By currency
Singapore dollar
Hong Kong dollar
US dollar
Others
Total (Gross)
Notes:
1/ Includes customer loans classified as financial assets at fair value through profit or loss on the balance sheet
2/ The business segments have been reaggregated following a review. Historical comparatives have been restated to conform to the current year presentation
3/ Loans by geography are classified according to where the borrower is incorporated. Historical comparatives have been restated to conform to the current year presentation
Gross customer loans rose 3% from the previous
quarter to $154.7 billion. Excluding currency effects,
loan growth was 4%. The growth was led by broadbased regional corporate loan demand. Housing loan
growth was due to drawdowns in Singapore.
Gross loans were 16% higher than a year ago, with half
of the increase in Singapore-dollar loans. The
expansion was spread across most regions and across
corporate and consumer borrowers.
15
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
NON-PERFORMING ASSETS AND LOSS ALLOWANCE COVERAGE
By business unit
1/
2/
NPA
($m)
SP
($m)
GP
($m)
NPL
(% of loans)
(GP+SP)/NPA
(%)
(GP+SP)/
unsecured
NPA
(%)
317
107
502
0.6
192
323
2,561
1,105
974
2.5
81
102
2,878
1,212
1,476
1.9
93
121
28
6
124
-
464
1,300
307
127
252
-
123
134
3,213
1,345
1,852
-
100
127
377
163
490
0.8
173
268
2,794
1,215
959
2.8
78
100
3,171
1,378
1,449
2.1
89
117
112
77
122
-
177
211
222
112
249
-
163
174
3,505
1,567
1,820
-
97
124
513
195
440
1.2
124
236
3,363
1,410
885
3.8
68
86
3,876
1,605
1,325
2.9
76
100
160
106
92
-
124
164
183
97
255
-
192
209
4,219
1,808
1,672
-
83
108
31 Dec 2010
Consumer/ Private
Banking
Institutional Banking
Total non-performing
loans (NPL)
Debt securities
Contingent liabilities &
others
Total non-performing
assets (NPA)
30 Sept 2010
Consumer/ Private
Banking
Institutional Banking
Total non-performing
loans (NPL)
Debt securities
Contingent liabilities &
others
Total non-performing
assets (NPA)
31 Dec 2009
Consumer/ Private
Banking
Institutional Banking
Total non-performing
loans (NPL)
Debt securities
Contingent liabilities &
others
Total non-performing
assets (NPA)
Notes:
1/ Allowances for credit and other losses exclude one-time items
2/ The business segments have been reaggregated following a review. Historical comparatives have been restated to conform to the current year presentation
16
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
By geography
31 Dec 2010
Singapore
Hong Kong
Rest of Greater China
South and South-east
Asia
Rest of the World
Total non-performing
loans
Debt securities
Contingent liabilities
& others
Total non-performing
assets
30 Sept 2010
Singapore
Hong Kong
Rest of Greater China
South and South-east
Asia
Rest of the World
Total non-performing
loans
Debt securities
Contingent liabilities
& others
Total non-performing
assets
31 Dec 2009
Singapore
Hong Kong
Rest of Greater China
South and South-east
Asia
Rest of the World
Total non-performing
loans
Debt securities
Contingent liabilities
& others
Total non-performing
assets
NPA
($m)
SP
($m)
GP
($m)
NPL
(% of loans)
(GP+SP)/NPA
(%)
(GP+SP)/
unsecured
NPA
(%)
594
359
250
196
212
166
613
369
145
0.8
1.0
1.9
136
162
124
300
230
176
164
107
189
1.2
180
185
1,511
531
160
9.5
46
50
2,878
1,212
1,476
1.9
93
121
28
6
124
-
464
1,300
307
127
252
-
123
134
3,213
1,345
1,852
-
100
127
635
377
270
195
226
190
611
367
123
0.9
1.0
2.4
127
157
116
311
222
154
146
92
191
1.1
195
200
1,743
675
157
10.9
48
54
3,171
1,378
1,449
2.1
89
117
112
77
122
-
177
211
222
112
249
-
163
174
3,505
1,567
1,820
-
97
124
731
567
352
213
327
213
546
330
121
1.2
1.7
3.1
104
116
95
244
173
143
157
82
174
1.3
163
186
2,069
770
154
13.1
45
49
3,876
1,605
1,325
2.9
76
100
160
106
92
-
124
164
183
97
255
-
192
209
4,219
1,808
1,672
-
83
108
17
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
By industry
($m)
31 Dec 2010
30 Sept 2010
31 Dec 2009
NPA
SP
NPA
SP
NPA
SP
Manufacturing
Building and construction
Housing loans
General commerce
Transportation, storage & communications
Financial institutions, investment & holding companies
502
90
118
248
646
960
325
25
17
107
183
399
533
39
125
322
628
1,200
330
12
19
161
150
545
735
89
188
472
264
1,738
386
22
30
238
97
621
Professionals & private individuals (except housing
loans)
173
74
174
74
234
113
Others
Total non-performing loans
Debt securities
Contingent liabilities & others
Total non-performing assets
By loan classification
($m)
Non-performing assets
Substandard
Doubtful
Loss
Total
Restructured assets
Substandard
Doubtful
Loss
Total
By collateral type
($m)
141
82
150
87
156
98
2,878
28
1,212
6
3,171
112
1,378
77
3,876
160
1,605
106
307
127
222
112
183
97
3,213
1,345
3,505
1,567
4,219
1,808
31 Dec 2010
30 Sept 2010
31 Dec 2009
NPA
SP
NPA
SP
NPA
SP
2,086
737
390
3,213
374
580
391
1,345
2,013
993
499
3,505
342
723
502
1,567
2,155
1,431
633
4,219
195
977
636
1,808
443
145
28
616
47
128
28
203
422
218
30
670
55
120
30
205
389
90
54
533
51
73
54
178
31 Dec 2010
30 Sept 2010
31 Dec 2009
NPA
NPA
NPA
2,523
2,726
3,233
Secured non-performing assets by collateral type
Properties
250
284
540
Shares and debentures
Fixed deposits
Others
85
38
317
112
37
346
124
22
300
3,213
3,505
4,219
Unsecured non-performing assets
Total
18
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
By period overdue
($m)
31 Dec 2010
30 Sept 2010
31 Dec 2009
NPA
NPA
NPA
Not overdue
180 days overdue
1,294
225
124
1,570
1,323
198
655
1,329
1,802
358
113
1,946
Total
3,213
3,505
4,219
Non-performing loans fell 9% from the previous quarter
and 26% from a year ago to $2.9 billion. The NPL rate
was 1.9%, compared to 2.1% in the previous quarter and
2.9% a year ago. Forty percent of classified nonperforming assets were still current in interest and
principal.
Allowance coverage amounted rose to 100% of nonperforming assets from 97% in the previous quarter and
83% a year ago.
FUNDING SOURCES
($m)
Customer deposits 1/
Interbank liabilities 2/
Other borrowings and liabilities 2/
Shareholders’ funds
Total
31 Dec 2010
30 Sept 2010
31 Dec 2009
193,692
18,854
44,565
26,599
283,710
185,211
19,720
48,081
26,424
279,436
183,432
9,320
40,519
25,373
258,644
Notes:
1/
Includes customer deposits classified as financial liabilities at fair value through profit or loss on the balance sheet
2/
Includes liabilities classified as financial liabilities at fair value through profit or loss on the balance sheet
19
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
CUSTOMER DEPOSITS 1/
($m)
By currency and product
Singapore dollar
Fixed deposits
Savings accounts
Current accounts
Others
Hong Kong dollar
Fixed deposits
Savings accounts
Current accounts
Others
US dollar
Fixed deposits
Savings accounts
Current accounts
Others
Others
Fixed deposits
Savings accounts
Current accounts
Others
Total
Fixed deposits
Savings accounts
Current accounts
Others
31 Dec 2010
30 Sept 2010
31 Dec 2009
112,228
20,081
76,417
14,916
814
23,220
12,946
7,082
3,081
111
30,022
16,064
3,255
9,777
926
28,222
22,289
2,035
2,341
1,557
193,692
71,380
88,789
30,115
3,408
105,672
16,473
74,068
14,431
700
23,159
12,427
6,902
3,666
164
28,699
15,969
3,244
7,815
1,671
27,681
21,725
2,286
2,197
1,473
185,211
66,594
86,500
28,109
4,008
103,842
20,617
69,160
12,697
1,368
23,625
12,285
7,932
3,254
154
29,018
14,912
3,468
8,846
1,792
26,947
20,441
2,191
2,908
1,407
183,432
68,255
82,751
27,705
4,721
Note:
1/ Includes customer deposits classified as financial liabilities at fair value through profit or loss on the balance sheet
Customer deposits rose 5% from the previous quarter to
$193.7 billion as Singapore-dollar fixed and savings
deposits rose. There was also an increase in US dollar
current accounts.
Compared to a year ago, deposits rose 6%, with
Singapore-dollar savings accounts accounting for more
than half of the increase.
OTHER BORROWINGS & LIABILITIES
($m)
Subordinated term debts1/
Other debt securities in issue
Due within 1 year
Due after 1 year
Comprising:
2/
Secured
Unsecured
Others
Total
31 Dec 2010
30 Sept 2010
31 Dec 2009
6,398
6,572
7,702
505
1,655
530
1,615
44
369
2,160
36,007
44,565
2,145
39,364
48,081
75
338
32,404
40,519
Notes:
1/ All subordinated term debts issued are unsecured
2/ These are mainly secured by properties and securities
20
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
VALUE AT RISK AND TRADING INCOME
The Group uses a Value at Risk (VaR) measure as one mechanism for monitoring and controlling trading risk. The VaR is
calculated using a one-day time horizon and a 99% confidence interval. The following table shows the period-end, average,
high and low VaR for the trading risk exposure of the Group for the period from 1 January 2010 to 31 December 2010. The
Group’s trading book VaR methodology is based on Historical Simulation VaR.
($m)
1 January 2010 to 31 December 2010
Average
High
Low
As at 31 December 2010
Total
31
27
39
15
The charts below provide the range of VaR and the daily distribution of trading income in the trading portfolio for the
period from 1 January 2010 to 31 December 2010.
DBSH VaR for Trading Book
45
40
No. of Days
35
30
25
20
15
10
5
> 38- 39
> 37- 38
> 36- 37
> 35- 36
> 34- 35
> 33- 34
> 32- 33
> 31- 32
> 30- 31
> 29- 30
> 28- 29
> 27- 28
> 26- 27
> 25- 26
> 24- 25
> 23- 24
> 22- 23
> 21- 22
> 20- 21
> 19- 20
> 18- 19
> 17- 18
> 16- 17
> 15- 16
0
VaR ( S$ m illion)
Note:
With effect from 1 Jun 2009, the number of historical scenarios used for the VaR calculation was revised from 500 days to 250 days
Daily Distribution of Group Trading Income
(1 Jan 2010 to 31 Dec 2010)
45
40
35
25
20
15
10
5
Trading income (S$ million)
21
>28-30
>26-28
>24-26
>22-24
>20-22
>18-20
>16-18
>14-16
>12-14
>10-12
>8-10
>6-8
>4-6
>2-4
>0-2
>(2)-0
>(4)-(2)
>(6)-(4)
>(8)-(6)
0
>(10)-(8)
No. of days
30
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
CAPITAL ADEQUACY
($m)
Tier 1
Share capital
Disclosed reserves and others
Less: Tier 1 Deductions
Eligible Tier 1
Tier 2
Loan allowances admitted as Tier 2
Subordinated debts
Revaluation surplus from equity securities
Less: Tier 2 Deductions
Total eligible capital
Risk-weighted assets
Capital adequacy ratio (%)
Core Tier 1 ratio
Tier 1 ratio
Tier 2 ratio
Total (Tier 1 & 2) ratio
31 Dec 2010
30 Sept 2010
31 Dec 2009
8,780
23,927
(5,064)
27,643
8,775
20,851
(5,073)
24,553
8,435
20,928
(6,098)
23,265
696
5,281
149
(142)
33,627
182,694
482
5,415
171
(143)
30,478
186,847
434
5,970
87
(128)
29,628
177,222
11.8
15.1
3.3
18.4
11.2
13.1
3.2
16.3
11.0
13.1
3.6
16.7
The Group’s capital adequacy ratio increased from 16.3% in the previous quarter to 18.4% due to the S$2.5 billion
preference share issue in November 2010 and a reduction in risk weighted assets.
UNREALISED VALUATION SURPLUS/(LOSSES)
($m)
Properties
Financial investments
Total
31 Dec 2010
30 Sept 2010
31 Dec 2009
507
26
533
482
141
623
511
119
630
The amount of unrealised valuation surplus declined $90 million to $533 million in fourth quarter 2010 due to lower valuations
of financial investments.
22
DBS GROUP HOLDINGS LTD AND ITS SUBSIDIARIES
Audited Consolidated Income Statement
In $ millions
4th Qtr
20101/
4th Qtr +/(-)
20091/
%
3rd Qtr +/(-)
20101/
%
Year
2010
Year +/(-)
2009
%
Income
Interest income
Interest expense
Net interest income
Net fee and commission income
Net trading income
Net income/(loss) from financial instruments designated at fair value
Net income from financial investments
Other income
1,461
355
1,106
358
154
10
39
62
1,437
310
1,127
358
179
(124)
3
29
2
15
(2)
(14)
NM
>100
>100
1,457
378
1,079
340
235
(12)
123
44
(6)
3
5
(34)
NM
(68)
41
5,699
1,381
4,318
1,397
915
(20)
310
146
6,114 (7)
1,659 (17)
4,455 (3)
1,394
700
31
(267)
93
254
22
67 >100
Total income
1,729
1,572
10
1,809
(4)
7,066
6,603
7
Expenses
Employee benefits
Depreciation of properties and other fixed assets
Other expenses
Goodwill charges
Allowances for credit and other losses
362
56
362
157
313
48
339
384
16
17
7
(59)
360
43
323
195
1
30
12
(19)
1,422
193
1,310
1,018
911
1,292
195
1,117
1,552
10
(1)
17
NM
(41)
Total expenses
937
1,084
(14)
921
2
4,854
4,156
17
Profit/(Loss)
Share of profits of associates
Profit/(Loss) before tax
792
24
816
488
6
494
62
>100
65
888
31
919
(11)
(23)
(11)
2,212
102
2,314
2,447
66
2,513
(10)
55
(8)
Income tax expense
Net profit/(loss)
71
745
(47)
541
NM
38
146
773
(51)
(4)
454
1,860
285
2,228
59
(17)
678
67
745
493
48
541
38
40
38
722
51
773
(6)
31
(4)
1,632
228
1,860
2,041
187
2,228
(20)
22
(17)
Attributable to:
Shareholders
Non-controlling interests
Notes:
1/ Unaudited
NM Not Meaningful
Audited Consolidated Statement of Comprehensive Income
In $ millions
Net profit/(loss)
Other comprehensive income:
Foreign currency translation differences for foreign operations
Share of other comprehensive income of associates
Available-for-sale financial assets
Net valuation taken to equity
Transferred to income statement on sale
Tax on items taken directly to or transferred from equity
Other comprehensive income, net of tax
Total comprehensive income
Attributable to:
Shareholders
Non-controlling interests
+/(-)
%
3rd Qtr
1/
2010
+/(-)
%
Year
2010
Year +/(-)
2009
%
38
773
(4)
1,860
2,228
(17)
(97)
3
(4) (>100)
2
50
(109)
5
11
(40)
(187)
12
31
18
NM
(33)
(439)
(42)
26
(549)
32
NM
(31)
(35)
(15)
NM
(16) (>100)
474
(131)
(31)
208
NM
68
NM
NM
598
(315)
(28)
80
932
(312)
(100)
569
(36)
(1)
72
(86)
4th Qtr 4th Qtr
1/
1/
2010
2009
745
541
196
525
(63)
981
(80)
1,940
2,797
(31)
159
37
196
490
35
525
(68)
6
(63)
1,010
(29)
981
(84)
N