DBS to reward employees with $1,000 special bonus

SINGAPORE - DBS Group on Feb 10 said it will reward all staff, excluding senior managers, with a special one-time bonus of $1,000 each, and plans to introduce a new "capital return" dividend, as Singapore's biggest bank reported record earnings for 2024.

The bank's net profit for the fourth quarter to December 2024 rose 10 per cent to $2.62 billion from $2.39 billion a year earlier. This matched the mean estimate of nearly $2.63 billion from five analysts, according to LSEG data, Reuters said.

DBS said it achieved a record performance in 2024 as full-year net profit rose 11 per cent to $11.4 billion, with return on equity at 18 per cent.

Its shares jumped $1.70, or 3.8 per cent, to an all-time high of $46.38 as at 9.02am on Feb 10. Shares of peers OCBC and UOB also rallied more than 1 per cent.

DBS' latest bonus payments are expected to cost the bank a total of $32 million. It previously handed out $1,000 one-time bonuses to more than 5,500 junior staff in Singapore in February 2024 to help them cope with cost-of-living concerns.

South-east Asia's largest bank by assets said it plans to pay a final dividend of 60 cents per share for fourth quarter 2024, up from the year-ago payout of 54 cents.

This brings its ordinary dividend for the full year to $2.22 per share or $6.31 billion - an increase of 27 per cent from a year earlier.

DBS also plans to introduce a capital return dividend of 15 cents per share per quarter in financial year 2025, as a first step to managing down the stock of excess capital over the coming three years.

In the subsequent two years, DBS said it expects to pay out a similar amount of capital either through this or other mechanisms, barring unforeseen circumstances.

"The board will continue to consider all forms of returning capital," DBS said.

The bank also set aside $100 million from 2024's profits as part of its commitment of up to $1 billion over 10 years to support vulnerable communities.

Outgoing DBS chief executive Piyush Gupta said he is confident about the bank's outlook. "While macroeconomic and geopolitical uncertainties persist, the franchise and digital transformations carried out over the past decade position us well to continue delivering healthy returns," he said in a statement.

Analysts have said that local banks' earnings could take a hit this year, with global economic growth threatened by US President Donald Trump's trade tariffs and other policies.

For 2025, DBS expects group net interest income to slightly surpass 2024 levels based on the US Federal Reserve's projection of two rate cuts in the first half of 2025.

The bank also projects commercial book non-interest income growth to be in high-single digits, led by growth in wealth management fees and treasury customer sales.

In the fourth quarter under review, DBS' net interest margin (NIM), a key profitability gauge, rose to 2.15 per cent from 2.13 per cent in the same period a year earlier.

Commercial book net interest income rose 5 per cent to $3.83 billion thanks to the higher NIM and balance sheet growth.

Commercial book net fee income increased 12 per cent to $968 million, driven by growth in wealth management fees, as well as higher card, transaction service and investment banking fees. Loan-related fees declined 11 per cent.

Mr Gupta will pass the baton to Ms Tan Su Shan, deputy CEO, when he steps down in March.

DBS kicked off local banks' earnings season, with UOB slated to report on Feb 19 and OCBC on Feb 26.