Broker Name: Maybank Research Pte Ltd
Date of Report: February 9, 2026
Excerpt from Maybank Research Pte Ltd report.
- DBS Group is rated a BUY with a raised target price of SGD65.31, as Maybank expects high capital returns, strong ROE visibility, and stable earnings, especially as liquidity flows to Singapore support NII and fee income, despite a declining interest rate environment.
- DBS benefits from strong fundamentals, AI-driven cost efficiencies, and benign asset quality, with upside risks from further write-backs and potential special dividends, while downside risks are limited by the bank’s scale and safe-haven status in Singapore.
Report Summary
- DBS Group’s 4Q25 results were slightly below expectations due to weak trading, but conditions are improving in early FY26.
- Loan growth is forecasted at 5.5% YoY in FY26, limiting downside risk to NIMs even as policy rates fall; fee and wealth management income are expected to rise.
- Trading income disappointed in 4Q, but management notes a recovery in Jan/Feb; Maybank expects flat trading YoY for FY26.
- AI implementation is beginning to deliver cost savings and could further enhance productivity, leading to lower operating expenses.
- Asset quality remains strong, with NPLs stable at 1.0%, and credit charges expected to remain low due to management overlays and improving NPLs.
- DBS has completed only 12% of its SGD3bn share buyback mandate, leaving room for potential special dividends if not utilized by FY27.
- The bank offers an attractive dividend yield above 5.5% and maintains strong capital ratios (CET1 ~17%).
- Key risks include macroeconomic shocks (e.g., US-China trade war escalation), regional M&A integration risks, and slower China recovery, but Maybank sees more upside than downside.
- Maybank’s multi-stage DDM model supports the new target price of SGD65.31; BUY recommendation is maintained.
Above is an excerpt from a report by Maybank Research Pte Ltd. Clients of Maybank Research Pte Ltd can be the first to access the full report from the Maybank website: https://www.maybank.com/investment-banking
