SINGAPORE (July 29): DBS Group’s reported record earnings of $3.25 billion for 1H19 after 2Q19 earnings rose 20% to $1.60 billion from a year ago.

The quarterly bottomline beat the average estimate from three analysts of $1.47 billion, according to data from Refinitiv.

DBS says total income rose 16% to $3.71 billion from $3.2 billion a year ago which outstripped a 9% growth in expenses.

Net interest income increased 9% to $2.43 billion from $2.23 billion as loans grew 5% in constant-currency terms and net interest margin improved six basis points to 1.91%.

Net fee income rose 9% to a new high of $767 million.

Wealth management fees grew 11% to $332 million from higher investment product sales.

Card fees increased 16% to $198 million from higher activities across the region while investment banking fees rose 44% to $56 million from higher debt and equity capital market income.

Other non-interest income rose 88% to $513 million.

Trading income increased 57% from a weak year-ago performance to $357 million while gains on investment securities quadrupled from a low base to $131 million.

Expenses rose 9% to $1.55 billion while profit before allowances was 21% higher at $2.16 billion.

DBS says asset quality remained healthy. Non-performing assets rose 3% from the previous quarter to $5.82 billion as new non-performing asset formation remained low and was moderated by recoveries and write-offs.

The NPL rate was unchanged from the previous quarter at 1.5%.

For the first half, specific allowances amounted to $369 million, up 45% from a year ago when there had been a write-back of $65 million from the sale of an oil and gas support service vessel.

The Common Equity Tier-1 ratio declined from 14.1% in the previous quarter to 13.6% as the payment of the final 2018 and first-quarter 2019 dividends in May and an increase in risk-weighted assets during the quarter were partially offset by retained earnings.

DBS has declared a 2Q19 dividend of 30 cents per share, unchanged from the previous quarter.

In it outlook statement, DBS says it sees 2019 high-single-digit percent income growth and cost-income ratio at 43%.

DBS CEO Piyush Gupta says, “We achieved a record half-year performance despite heightened economic uncertainty and geopolitical tensions. The results reflect the strengths of an entrenched broad-based franchise that is well placed to nimbly navigate market volatility and capture opportunities as they arise.”

Shares in DBS closed 3 cents lower at $26.88 on Friday.

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