DBS Group's profits plummet 29% to $1.165b in Q1

The allocated $700m for COVID-19 risks prompted an increase in general allowance.

DBS Group recorded a 29% plunge in net profit for Q1 2020 to $1.17b, as it pre-emptively allocated $700m for risks arising from the coronavirus pandemic, a bourse filing revealed.

The charge triggered a 29% increase in general allowance to $3.23b to bolster the balance sheet.

Also read: DBS to start closing branches until 4 May

Total income rose 13% to a record $4.02b from $3.55b in Q1 2019 on the back of loan growth, robust fee income and higher investment gains. Net interest income inched up 7% YoY and 2% QoQ to $2.48b, with loans growing 1% from the previous quarter to $369b due to a 5% growth in non-trade corporate loans mostly from Singapore and Hong Kong.

Fee income grew 14% to a record high of $832m, led by a 28% increase in wealth management fees, 17% growth in loan-related fees, and a 64% surge in investment banking fees. On the other hand, card fees slipped 8% due to lower transactions across the region.

Net interest margin ended at 1.86% from 1.88% in Q1 2019. The quarterly dividend remained unchanged at $0.33 per share.