DBS : Second-Quarter Net Income Fell 22% On Higher Allowances

By P.R. Venkat

DBS Group Holdings Ltd.'s second-quarter net profit fell 22% on year as the bank set aside a greater portion of allowances anticipating risks from the Covid-19 pandemic.

Net profit for the quarter ended June was 1.25 billion Singapore dollars (US$912.4 million), one of Southeast Asia's largest banks by assets said Thursday.

Total income was marginally higher at S$3.73 billion mainly supported by non-interest income.

For the first half, the lender has set aside S$1.26 billion toward expected credit losses, thereby taking the total allowances to S$1.94 billion.

The second-quarter results came in higher than the S$1.17 billion estimated by analysts polled by Factset.

In line with the central bank's guidance asking local banks to moderate their dividend payout, DBS said it will pay 18 Singapore cents as dividends in the second quarter.

The estimated dividend payable is S$457 million, DBS said.

The bank said that its liquidity remained healthy and that it would maintain a solid balance sheet with ample capital.

Banks across the world have set aside billions of dollars toward provisioning or credit allowances anticipating the impact of Covid-19 pandemic on economies and businesses.

For the first half, net profit was down 26% on year to s$2.41 billion, while total income rose 7% to S$7.75 billion.

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