DBS Group, Singapore’s largest bank, reported a record net profit for the third quarter on Thursday but forecast that 2025 profits would fall below 2024 levels due to the introduction of a global minimum corporate tax rate in Singapore.
For the July-September period, DBS’s net profit jumped 15% to S$3.03 billion ($2.27 billion), easily surpassing the consensus estimate of around S$2.80 billion from five analysts, according to LSEG data. This result also exceeded its previous quarterly record of S$2.96 billion set in the first quarter of 2024, even though its net interest margin, a key indicator of profitability, slipped to 2.11% from 2.19% in the same quarter last year.
The strong performance was driven by record fee income, particularly from wealth management, higher treasury customer sales, and increased trading income from the markets.
While Singaporean banks, including DBS, have benefited from rising global interest rates and an influx of wealth attracted by the city-state’s political stability, analysts warn that rate cuts by major central banks and global economic and geopolitical volatility are expected to slow growth moving forward.
Looking ahead, DBS projected that its 2025 pre-tax profit and group net interest income would remain roughly in line with 2024 levels. However, net profit after tax is expected to decline due to the 15% global minimum corporate tax that will be implemented in Singapore starting in January, which will affect multinational companies such as DBS.
The bank also declared a quarterly dividend of 54 Singapore cents per share, up from 48 cents in the same quarter last year. Additionally, DBS announced a new S$3 billion share buyback program.
CEO Piyush Gupta commented, “The new buyback program reflects our strong capital position and ongoing earnings generation, reinforcing our commitment to capital management.”
Jefferies analysts Sam Wong and Shujin Chen noted in a research note that they expected a positive market reaction to the results, highlighting the bank’s strong performance and capital returns. DBS’s local competitors, Oversea-Chinese Banking Corporation and United Overseas Bank, are due to release their quarterly results on Friday.
