The three major banks in the Straits Times Index (STI)—DBS Group Holdings, Oversea-Chinese Banking Corp, and United Overseas Bank—have reported a robust financial performance for the first quarter of 2025. Despite initial tariff concerns in April causing a 13.7% decline in total returns, the banks rebounded with a 12.3% average total return by mid-May. Retail investors responded by net buying S$1.47b in shares, although this slowed to S$65m in the following month.
The banks collectively reported a net interest income (NII) of S$8.4b and a non-interest income (NOII) of S$4.8b, culminating in a total income of S$13.2b for Q1 2025. This marks the tenth consecutive quarter where the combined NII exceeded S$8.0b. The banks have been able to maintain stable NII by securing fixed-rate loan portfolios, mitigating the impact of interest rate cuts.
Capital management initiatives are also underway, with DBS, UOB, and OCBC engaging in significant share buyback programmes and special dividends. Over the first four months of 2025, the banks led the local market in share buybacks, with a combined consideration of S$550m. DBS alone executed a S$3b share buyback programme, whilst UOB and OCBC announced capital returns of S$3b and S$2.5b, respectively, through dividends and buybacks.
The banks’ strong financial performance and strategic capital management initiatives underscore their resilience and adaptability in a challenging economic environment. Looking ahead, these initiatives are expected to continue bolstering investor confidence and shareholder value.
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