DBS Group (DBSDF) reported a record first-quarter net profit of S$2.57 billion ($1.92 billion), which increased by 43% on a year-over-year basis. DBS is a Singapore-based banking and financial services provider.
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The company benefitted from a 66 basis point expansion of net interest margin, strong asset quality, and sustained business momentum.
Meanwhile, card fees climbed 21% year-over-year due to strong travel demand, whereas investment banking fees rose 2%. On the other hand, commercial book net fee income and wealth management fees declined by 4% and 11%, respectively.
In addition, DBS reported its highest-ever return on equity of 18.6% in the first quarter, compared with 13.1% in the same quarter last year.
Going forward, the bank anticipates a 3% to 5% increase in loan growth in 2023. Further, fee income is expected to grow in the high single digits, driven by a recovery in wealth management and investment banking, and card fee growth.
The full-year 2023 return on equity is anticipated to be more than 17%, and expenses are likely to grow by 9-10%.
Is DBS a Good Buy Now?
The bank was able to attract deposits during the quarter, despite fears of the global banking crisis that were sparked after Credit Suisse’s fall. DBS CEO Piyush Gupta said, “We delivered a record performance and benefited from safe-haven deposit inflows during a quarter marked by increased market volatility.”
It is worth highlighting that DBS Group is a Buy based on the summary signals of TipRanks’ easy-to-understand and simple technical analysis tool. This implies that the stock has further upside potential from current levels.
