DBS purchases Soc Gen’s private banking Asian business
 
On 17 March, DBS announced it will be buying Societe Generale SA’s Asian private banking business unit for $220 million, representing 1.75% of the French bank’s private banking assets of $12.6 billion as at 31 Dec 2013. According to the announcement, this transaction will include Soc Gen’s private banking operations in Singapore and Hong Kong, together with selected parts of the trust business. 
 
DBS said that this will increase the bank’s high-net-worth assets under management by more than 20%, bolstering its market share in Asia. In addition, the transaction will be funded in cash and is expected to contribute to earnings one year after its completion.
 
DBS share price
 
DBS hit its year to date lowest closing price of $15.66 on 20 March, after the US Federal Reserve announced their plans to exit their asset purchase program later this year, coupled with a possibility of raising interest rates. Closing at 16.08 last Friday (28 March), DBS has rebounded approximately 2.7% since then and is currently trading 0.4% higher than its 20-day moving average of $16.02.
 
DBS share price has declined approximately 6% year-to-date, compared to the STI’s 0.2% gain. DBS is the second largest index laggard on the STI, contributing to 21 index points of the STI’s downside pressure thus far.

Source: Macqiarie Research - 31 Mar 2014