Growth in DBS Bank’s housing loans business weakened further than expected last year following the introduction of new property cooling measures in July. Despite the slower mortgage growth, DBS Bank’s earnings increased significantly by 28 percent year-on-year to $5.63 billion, a record high and the first time that the lender’s net profit surpassed $5 billion.
Growth in DBS Bank’s housing loans business weakened further than expected last year following the introduction of new property cooling measures in July, reported the Business Times.
Despite revising its original full-year forecast of $4 billion to $2.5 billion when it announced its Q3 financial results in November, the bank still missed its projection as the final tally was shy of $2 billion.
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“Mortgage business continues to be slow. Actually, our mortgage growth last year didn’t even come in at $2 billion,” said DBS CEO Piyush Gupta. For the last quarter of 2018, its housing loan business rose by $500 million.
“Bookings have been particularly slow. Overall, our new bookings are coming in at least 30 to 40 percent lower than they were before the cooling measures.” Nonetheless, its market share of Singapore residential mortgages remained at 31 percent.
For the entirety of 2019, the lender thinks than its housing loan business would grow by approximately $1.5 billion to $2 billion, on the back of around 65 new housing projects to be launched in the city-state this year.
Despite the slower mortgage growth in 2018, DBS Bank’s earnings increased significantly by 28 percent year-on-year to $5.63 billion, a record high and the first time that the lender’s net profit surpassed $5 billion. At the same time, its revenue rose by 11 percent to $13.18 billion, also a record high.
“We achieved financial results befitting our 50th anniversary, a year when we were also recognised as the world’s best bank and best digital bank,” Gupta noted.
Get more details on the property market outlook for 2019 here
Romesh Navaratnarajah, Senior Editor at PropertyGuru, edited this story. To contact him about this or other stories, email romesh@propertyguru.com.sg
