During the quarter, the sector’s 2QFY2025 patmi fell by 3% y-o-y and 5% q-o-q due to weaker operating income. Overall NIMs fell by 9 basis points q-o-q and 16 basis points y-o-y with the declines in benchmark rates coming through.
DBS Group Holdings remains the banking sector top pick for the team at RHB Bank Singapore amid a generally “tough” 2QFY2025.
This comes as the bank’s 1HFY2025 patmi, which came in at 53% of RHB’s and the consensus’ FY2025 estimates, was the only one to meet expectations. Oversea-Chinese Banking Corporation (OCBC) and United Overseas Bank (UOB) missed expectations due to weaker-than-expected net interest incomes (NII) and net interest margins (NIMs). UOB’s loan growth also missed the mark while its loan provisions stood higher than forecasted.
