DBS stock surges on share buyback plan, record $3.03b profit

DBS Group Holdings unveiled a multibillion dollar share-buyback programme, as wealth management fees and trading income drove quarterly earnings past the $3 billion mark for the first time.

- REUTERS, BLOOMBERG

Its shares hit a record on the share buyback plan and higher-than-forecast profit. They closed at $41.70 on Nov 7, up 6.5 per cent. The stock has gained more than 37 per cent this year.

DBS, the first local lender to report third-quarter results, said net profit surged 15 per cent to $3.03 billion, beating the mean estimate of nearly $2.8 billion from five analysts, according to LSEG data.

It also topped the previous quarterly record of $2.96 billion set in the first quarter of 2024, even though its net interest margin, a key profitability gauge, declined to 2.11 per cent during the third quarter from 2.19 per cent the same quarter a year earlier.

Net profit for the nine months to Sept 30 rose 11 per cent year on year to a record $8.79 billion.

The strong result came on the back of record fee income driven by wealth management, higher treasury customer sales and increased markets trading income.

DBS sees an upside to its 2025 profit when Donald Trump takes office as US president next year, as his policies could spell fewer interest rate cuts by the Federal Reserve that translate into higher net interest margin.