Singapore’s DBS posted higher profit and record income in the third quarter, driven in part by expansion of the bank’s net interest margin.

Net profit at DBS rose 18 percent to S$2.6 billion ($1.9 billion) in the third quarter, according to the bank’s financial results. 

Total income increased 16 percent to a record S$5.2 billion, driven by higher interest margin and growth in non-interest income. Net interest income increased 23 percent to S$3.7 billion as net interest margin for the group climbed 29 basis points to 2.19 percent. For commercial book non-interest income, net fee and commission income was up 9 percent to S$843 million while treasury customer sales and other income rose 8 percent to S$499 million.

Expenses climbed 12 percent to S$2 billion from higher staff costs and the consolation of the newly acquired Citi Taiwan. The bank also recorded S$18 million of general allowances and S$197 million of specific allowances, «prudently taken for exposures linked to a recent money laundering case in Singapore». 

Citi Taiwan

In August, DBS completed the acquisition of Citi’s consumer banking business in Taiwan, which added S$10 billion in loans and S$12 billion in deposits. The bank also saw credit card accounts quintuple to over 3 million and investment assets under management triple to more than S$12 billion in assets under management. 

As a result of the deal, DBS recorded S$936 million of provisional goodwill and a one-time integration cost of S$40 million. 

The board declared an interim dividend of 48 cents per share for the quarter, or an estimated S$1.2 billion in dividends payable. In the first nine months of 2023, net profit at the bank was up 35 percent to S$7.9 billion.

Digital Disruption

Despite the positive results, DBS has been undergoing tech troubles after experiencing multiple disruptions to its digital banking platform. Last week, the Monetary Authority of Singapore imposed a six-month pause on non-essential IT changes that bans the bank from acquiring new business ventures, such as fintech startups. 

«We will […] dedicate ourselves to executing the comprehensive set of measures we recently announced to address the series of digital disruptions, for which we are truly sorry,» said DBS CEO Piyush Gupta. «We are committed to strengthening our technology resilience and ensuring customer service reliability.»