SINGAPORE, Aug 7 — Singapore’s DBS, South-east Asia’s biggest bank by assets, today reaffirmed its full-year outlook after reporting quarterly profit that beat market expectations, sending its share price to a record high.

DBS attributed the increase to higher total income, though profitability metrics fell slightly, and raised its dividend payout.

The bank fared better than peers Oversea-Chinese Banking Corp and United Overseas Bank, both of which cut their expectations for the full year citing the broader potential impact of US tariffs on South-east Asia.

The region has been a primary target of US President Donald Trump who has taken aim at Chinese goods passing through. Uncertainty brought about by Trump’s trade war, however, has started to lessen as countries seal trade deals with the US.

Today, DBS reaffirmed its overall 2025 outlook, including net interest income slightly above that of 2024, albeit with lower net profit.

“Q2 was marked by uncertainty. Business people don’t like uncertainty,” CEO Tan Su Shan said at an earnings briefing.

“So in Q2 we did see people press the pause button. Q3, I think we will start to see people look at more deals,” said Tan. “We are beginning to see that coming in.”

DBS shares rose as much as 2 per cent to a record S$49.85 (RM164.30) following the earnings results. They were last up 1.9 per cent versus 0.76 per cent in the benchmark Straits Times Index.

Lifting the stock was an 11 per cent on-year increase in the bank’s ordinary dividend to 60 Singapore cents a share. DBS also issued a capital return dividend of 15 cents, having not declared one at all a year earlier.

DBS reported a 1 per cent on-year rise in April-June net profit at S$2.82 billion, beating a S$2.77 billion average of three analyst estimates compiled by LSEG.

However, profitability metrics declined. The bank’s net interest margin fell to 2.05 per cent from 2.14 per cent and return on equity fell to 16.7 per cent from 18.2 per cent.

Commercial book net interest income fell 4 per cent amid lower interest rates but was partly offset by strong deposit growth, DBS said.

US stocks ended higher yesterday, with the Dow ticking up about two-tenths of a per cent, the S&P 500 adding nearly three-quarters of a per cent and the Nasdaq leading gains with a more than one per cent rise.

Second-order effects

Cross-town rival UOB resumed guidance today having paused in May until it could better assess the impact of US tariffs. It now sees 2025 loan growth in the low single digits rather than the high single digits it expected previously.

It also forecast fee income growth in the high single digits versus its earlier double-digit projection.

Deputy Chairman and CEO Wee Ee Cheong said tariffs’ direct impact on the bank has been minimal. He expressed concern over potential second-order effects such as weaker consumer sentiment and reduced investment activity.

“I think the underlying (fundamentals of South-east Asia) is still quite strong. The volatility is something that we need to manage,” Wee said at an earnings briefing.

UOB’s shares slipped nearly 1.7 per cent.

Singapore and South-east Asia’s third-largest lender posted a 6 per cent on-year decline in net profit at S$1.34 billion, missing the S$1.47 billion analyst consensus from LSEG.

UOB said its first decline since the first quarter of 2024 was brought about mainly by lower net interest income. It declared an interim dividend of 85 cents per ordinary share, down 3.4 per cent from a year earlier.

The banks’ results followed those of compatriot Oversea-Chinese Banking Corp, which on Friday reported second-quarter net profit in line with market expectations, but cut its 2025 net interest income view and flagged tariff uncertainty.

Major global lenders including HSBC and Standard Chartered have similarly highlighted macroeconomic risk in earnings reports, underscoring the broader impact of geopolitical trade tension on the financial sector. — Reuters