1787 views

DBS vs OCBC: Which bank will post a higher net profit in Q2?

According to UOB Kay Hian, both banks' net profits will decrease.

DBS and OCBC will post lower net profits in Q2 despite a lift in their respective net interest margins (NIM) on the back of rising interest rates, UOB Kay Hian said.

In a report, UOB Kay Hian said DBS will likely post a  5% YoY and 10% QoQ decline in its net profit, despite its NIM increasing by 7bp QoQ to 1.53%.

The analyst said the decline was due to a “high base with huge write-back in general provisions of S$112m in 1Q22.”

Whilst posting a bigger QoQ and YoY decrease, DBS’s net profit of $1.614b still surpassed OCBC’s $1.127b, which translates to a 2% YoY and 16% QoQ drop.  

OCBC’s NIM increase of 4bp QoQ to 1.59% is also lower than DBS.

“The pullback on a sequential basis was due to low total provisions of S$44m in 1Q22,” UOB Kay Hian said.

Both banks also suffered from lower wealth management fees amidst the Russia-Ukiran war during the quarter.

Contribution from wealth management is expected to decline 17% YoY and 10% YoY for OCBC and DBS, respectively.  
 

Follow the links for more news on

Join Singapore Business Review community
Since you're here...

...there are many ways you can work with us to advertise your company and connect to your customers. Our team can help you dight and create an advertising campaign, in print and digital, on this website and in print magazine.

We can also organize a real life or digital event for you and find thought leader speakers as well as industry leaders, who could be your potential partners, to join the event. We also run some awards programmes which give you an opportunity to be recognized for your achievements during the year and you can join this as a participant or a sponsor.

Let us help you drive your business forward with a good partnership!