DBS Group reported a 1% rise in second-quarter net profit to S$2.82 billion, exceeding market forecasts. The bank increased its ordinary dividend by 11% and introduced a special capital return, signaling strong shareholder value focus. However, return on equity dipped to 16.7%, and net interest margin eased to 2.05%, reflecting ongoing pressures on lending profitability.

In contrast, UOB posted a 6% drop in net profit to S$1.34 billion for the same quarter and revised down its full-year earnings outlook. The bank cited a softer interest rate environment and slower-than-expected growth in regional loan demand.

The diverging performance of Singapore’s two major lenders underscores the importance of strategic positioning in a changing economic climate, with digital transformation and fee-based income expected to be key growth drivers in the next 12 months.

Sophia Tan

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