DBS Group Profit Falls 29% as Loan-Loss Provisions Surge

(Bloomberg) -- DBS Group Holdings Ltd., Southeast Asia’s largest lender, posted its first quarterly profit decline since 2017 as the coronavirus pandemic and oil price slump triggered a spike in loan-loss provisions.

• Net income fell 29% to S$1.17 billion ($829 million) in the three months ended March 31 from S$1.65 billion a year earlier, the Singapore-based bank said Thursday. That compares with the S$1.19 billion average estimate of six analysts surveyed by Bloomberg. DBS last posted a quarterly profit decline in the third quarter of 2017.

Key Insights

• DBS joins a host of international banks including JPMorgan Chase & Co. and HSBC Holdings Plc in setting aside hefty provisions for bad debts, as the pandemic cripples the global economy and slashes profits among the lenders’ corporate customers.
• Net interest income grew as key interest rates were resilient despite the U.S. Federal Reserve’s cut in March.
• Investors will focus on any comments from Chief Executive Officer Piyush Gupta on the full-year outlook and on dividend prospects at a media briefing which is due to start at 10:30 a.m.

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