Singapore, Jan 15, 2026, 15:50 SGT — Regular session.
- DBS shares hovered close to recent highs in afternoon trading.
- Investors weigh the bank’s dividend appeal amid a backdrop of softer rates.
- Attention turns to February results, with an eye on margins, payouts, and capital returns.
Shares of DBS Group Holdings Ltd edged up 0.8% to S$58.80 on Thursday afternoon, hovering just below their 52-week peak of S$58.82. The stock traded in a range from S$57.98 to S$58.82 throughout the session. (Investing)
The move keeps DBS firmly in view as Singapore banks rally, with yield and perceived safety driving interest. For DBS, there’s little margin for error on dividends or profit margins now.
Rates linger in the background. When funding and lending rates drop, net interest margin — the gap between what banks earn on loans versus what they pay on deposits — usually gets squeezed, unless fee income or volumes rise to compensate.
A new company update shifted the story. DBS’ chief data and transformation officer, Nimish Panchmatia, told The Business Times the bank generated a record S$1 billion in “economic value” from its AI efforts in 2025, rising from S$750 million in 2024, according to comparisons with a control group. (The Business Times)
Analysts are divided on how much is already baked into the prices. Jonathan Koh from UOB Kay Hian noted that local banks could rely on “resilient earnings” and fee growth to cushion margin pressures. Meanwhile, Macquarie highlighted valuation risks and stuck to its “underperform” rating on DBS. Others see dividend yields near 5% as a buffer, even if earnings slow down. (The Straits Times)
DBS has flagged plans for bigger ordinary payouts alongside a separate capital return dividend, a special payout drawn from excess capital. This move adds fuel to the ongoing tug-of-war between income seekers and valuation hawks.
The downside is clear: if rate cuts hit sooner than anticipated, loan growth lags, or credit costs rise, investors could begin doubting how sustainable the dividend story really is at current valuations.
Traders will be keeping an eye on whether AI-driven savings and productivity gains hit the cost line fast enough to make a difference, instead of just remaining a distant promise.
DBS Group Holdings will release its full-year 2025 earnings before the market opens on Monday, Feb. 9. (SGX Links)
