DBS delivered a good set of FY17 results this morning. Net profit of S$4,371m was up 3% from the previous year, fairly in line with market and our expectations. Net Interest Income rose 7% to S$7791m, while Non-interest Income gained 7% to S$4483m.

On a QoQ basis, 4Q17 allowances came off 72% from S$815m in 3Q17 to S$225m. The final quarter’s performance was led by an increase in wealth management and higher unit trust and other investment product sales. In addition, Investment Banking also saw a doubling in fees from higher equity market and fixed income activities.

For the final dividend of 2017, management has proposed a payout of 60 cents per share, bringing full-year dividend to 93 cents, up 55% from 60 cents in the previous year. In addition, it also proposed a special dividend of 50 cents.

We will provide more details after the briefing. We have a BUY on DBS.

Source: OCBC Research - 8 Feb 2018