DBS reports 5% drop in Q3 profit as trading income falls

DBS Group Holdings said its net profit for the quarter ended 30 September 2026 fell 5% to S$2.81 billion, below the S$2.95 billion consensus estimate from Bloomberg analysts. The decline was driven by a sharp 65% drop in markets trading income, which fell to S$152 million amid unfavourable equity market conditions.

Group net interest income rose 4% to S$3.71 billion, helped by hedging activities and balance-sheet growth, while the net interest margin slipped nine basis points to 1.87%. The bank’s commercial book saw net fee and commission income increase 6% to S$1.43 billion and treasury customer sales and other income rise 19% to S$685 million.

DBS declared a total dividend of S$0.81 per share, comprising an ordinary dividend of S$0.66 and a capital return dividend of S$0.15, up from S$0.75 per share a year earlier. The bank’s non-performing loan ratio improved to 0.9% from 1.0%.

The Common Equity Tier-1 ratio stood at 15.9% under transitional arrangements, with a pro-forma ratio of 14% on a fully phased-in basis. Adjusted for a reduced operational risk multiplier announced by the Monetary Authority of Singapore, the ratios would be 16.1% and 14.1% respectively.

Looking ahead, DBS expects total income growth in the mid-single-digit range for 2027, anticipating two further U.S. rate hikes, a Sora average around 1.6%, and a stronger Singapore dollar. The bank projects loan and deposit growth to support net interest income and continued expansion in wealth management, while targeting a cost-income ratio in the low-40% range.

"As we enter 2027, we will stay nimble to capture opportunities while prudently managing risks," CEO Tan Su Shan said, noting heightened uncertainty from energy prices, tighter financial conditions and geopolitical risks.

In a separate filing, DBS announced that chairman Peter Seah will retire after 16 years, with board member Anthony Lim set to succeed him on 1 January 2027. Shares closed marginally lower at S$70.78.