To The Moon

Bank Earnings Snapshot (Q2 2025)

[Disclaimer:The information provided here is for educational and informational purposes only and reflects my own research and personal views. It should not be interpreted as investment advice, financial guidance, or a recommendation to buy or sell any securities or financial instruments. Please conduct your own due diligence or consult a licensed financial advisor before making any investment decisions.]

• DBS reported a 1% year-on-year increase in net profit to S$2.82 billion, beating analyst expectations on the back of higher total income. It maintained its 2025 outlook and issued both an ordinary dividend (60 ¢) and a capital return dividend (15 ¢). However, return on equity dropped to 16.7%, and net interest margin (NIM) declined to 2.05%.

• UOB saw a 6% decline in net profit to S$1.34 billion, missing forecasts. The drop was driven by lower net interest income. UOB trimmed its 2025 guidance and reduced its interim dividend.

• OCBC had in-line Q2 results, though it cut its 2025 net interest income expectations and flagged ongoing uncertainty from global tariffs.

Three Takeaways on DBS

• Resilient Income Generation & Shareholder Returns

DBS achieved solid total income, managed to beat profit estimates, and strengthened its capital-return strategy—demonstrating confidence in its financial flexibility.

• Margin & Profitability Pressure

There are clear signs of margin pressure: NIM eased from 2.14% to 2.05%, and ROE declined from ~18% to 16.7%.

• Strong Outlook & Balance Sheet Management

DBS reaffirmed that net interest income in 2025 is expected to exceed 2024 levels and that its balance sheet and liquidity position the bank well for macro uncertainties.

Outlook: Next 3–6 Months

• DBS

Expect modest net profit pressure if NIM compression continues, but this may be offset by strong fee and trading income, along with robust capital returns. Liquidity and balance sheet strength will be key.

• UOB

Face headwinds from compressed margins and lowered fees/loan growth. Profit growth may remain suppressed unless macro conditions improve or new drivers emerge.

• OCBC

Although earnings are stable, persistent margin erosion and cautious guidance could limit upside. Still, its capital strength affords flexibility.

Summary

• DBS remains the most resilient among the three through strong income and shareholder returns, despite margin and ROE softness.

• UOB and OCBC face downside risks from macro uncertainties and NIM compression.

• Moving forward, DBS’s diversified income streams and proactive management offer a brighter short-term outlook, whereas UOB and OCBC may experience more muted earnings in a challenging environment.

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