星展集团控股有限公司（DBS SP）：2025年第一季度业绩营业利润总额超预期，资产质量在总拨备较高情况下保持完好

ASIA-PACIFIC excl. Japan | BanksDBS Group Holdings Ltd. 1Q25 Result: PPOP Beat, Asset Quality IntactDespite Higher GP DBS reported 1Q25 net profit of S$2.9bn, -2% yoy/+15% qoq, 7% ahead ofcons although 7% below JEF. PPOP was +6% yoy/+19% qoq, 6% aheadof cons and in line with JEF, mainly led by non-II +8% yoy/+25% qoq,7%/1% ahead of cons/JEF. SP was stable at 10bps, with insignificant NPLformation. Provisions were higher mainly due to GP. Fully loaded CET1 is15.2%, +0.1ppt qoq. Maintain our preference for DBS. Key positives-1) NII resilient, +5% yoy/-1% qoq, broadly in line with JEF/cons. NIM -3bpsqoq to 2.12%, with a decline in commercial book NIM (-9bps qoq to 2.68%) offset by lowerfunding costs for trading. Loans rose 2% qoq in constant currency terms, driven by +3% qoqgrowth in non-trade corp loans offsetting 1% decline in trade loans. Deposit growth was +3%qoq, also on constant currency.2) Non-II strong. Fee income +22% yoy/+32% qoq, led bywealth +35% yoy/+39% qoq and loan related fees +23% yoy/+79% qoq. AUM grew +1.4% qoqto new high of S$432bn. Elsewhere, market trading was +3% yoy/+54% qoq, treasury saleswere +11% yoy/+32% qoq, although total trading and other income was -6% yoy/+17% qoqdue to non-recurrence of one-off gains.3) Healthy CIRat 37%, flat yoy. Expenses grew +6%yoy, in line with revenue, and -8% qoq on seasonality.4) Capital return dividend. As previouslycommunicated, DBS declared a 15c capital return DPS on top of its regular 60c quarterly DPS.Total DPS rose +39% yoy to 75c. Key negatives-1) Higher CoR, +17bps yoy/+10bps qoq to 30bps. SP was stable yoy at 10bpsand improved 10bps qoq, meaning the increase in CoR was mainly due to GP. NPL ratio is1.1%, flat qoq, with new NPA only at S$159mn (-50% yoy/-53% qoq). NPA coverage improved+8ppt qoq to 137%. Outlook-1)Business momentum resilient in Apr but risk from heightened uncertainty.2)Group NII slightly above 2024 based on 3 rate cuts (previously based on 2 rate cuts), withlower NIM offset by balance sheet growth.3)Commercial book non-II growth to be at MSD toHSD (vs. previously HSD).4)CIR in low-40% range (unchanged).5)SP assumed to normaliseto 17-20bps (unchanged), with GP reserves to provide buffer.6)Net profit to be below 2024levels mainly due to global minimum tax of 15% (unchanged). Implications- The PPOP beat vs. cons underlines the underlying strength of DBS's franchise.Provision miss was mainly on precautionary GP, while SP and NPA formation remainedbenign. Outlook was marginally tweaked, mainly a small downgrade in non-II growth. The bankalso delivered on its capital return commitment. We maintain our preference for DBS withinSG banks. Sam Wong, CFA * | Equity Analyst852 3767 1146 | sam.wong@jefferies.comShujin Chen, CFA * | Equity Analyst852 3743 8747 | shujin.chen@jefferies.comJoanna Cheah, CFA ^ | Equity Analyst+65 6551 3963 | jcheah@jefferies.com We would like to thank Iris Tian, employee of Evalueserve Inc., for providing research support services to our preparation of this report. Company Description DBS Group Holdings Ltd. DBS Group Holdings Ltd. is an investment holding company that engages in the provision of retail, small and medium-sized enterprise, corporateand investment banking services. It operates through the following business segments: Consumer or Private Banking, Institutional Banking,Treasury, and Others. The Consumer or Private Banking segment provides services such as current and savings accounts, fixed deposits,loans and home finance, cards, payments, investment and insurance products. The Institutional Banking segment offers financial services andproducts to institutional clients including non-bank financial institutions, government linked companies, large corporate and small and medium-sized businesses. The Treasury segment supplies treasury services to corporations, institutional and private investors, financial institutions andother market participants. The Others segment encompasses activities from corporate decisions, and income and expenses not attributed tothe business segments described. The company was founded in 1968 and is headquartered in Singapore. Company Valuation/Risks DBS Group Holdings Ltd. Our PT of S$52 is based on an 13x multiple to 12m forward EPS. Key upside risks include better-than-expected loan growth, margins and assetquality. Key downside risks include worse-than-expected asset quality/any large NPA formation, dialling down of rate hike/steeper yield curveexpectations Analyst Certification: I, Sam Wong, CFA, certify that all of the views expressed in this research report accurately reflect my personal views about the subject security(ies) andsubject company(ies). I also certify that no part of my compensation was, is, or will be, directly or indirectly, related to the specific recommendations orviews expressed in this research report. I, Shujin Chen, CFA, certify that all of the views expressed in this research report accurately reflect my personal views about the