DBS Group reported a 10% fall in net profit for the fourth quarter ended Dec 31, 2025, to S$2.26 billion, from S$2.52 billion a year earlier.

Excluding S$100 million set aside for corporate social responsibility (CSR) commitments, net profit would have been S$2.36 billion.

Rate headwinds, higher tax expenses and the absence of non-recurring gains recorded a year ago outweighed stronger fee income and treasury customer sales.

The results missed the S$2.59 billion consensus forecast in a Bloomberg survey of six analysts, The Business Times reported.

The bank declared an ordinary dividend of S$0.66 per share and a capital return dividend of S$0.15 per share. This brings the total quarterly payout to S$0.81 per share, up from S$0.60 a year earlier.

DBS said it plans to continue paying the S$0.15 per share capital return dividend on a quarterly basis for financial years 2026 and 2027, barring unforeseen circumstances.

For the commercial book, total income fell 3% to S$5.18 billion. Net interest income declined 6% to S$3.59 billion due to a lower net interest margin, while net fee and commission income rose 14% to S$1.1 billion, led by wealth management.

Investment banking and loan-related fees were also higher. Lower other income, which had included non-recurring gains a year earlier, offset a 13% rise in treasury customer sales, causing other non-interest income to fall 11% to S$486 million.

Markets trading income slipped 3% to S$154 million.

Group net interest margin stood at 1.93% for the quarter, down from 2.15% a year earlier.

The non-performing loans ratio improved to 1% from 1.1%. This was despite what the bank described as a “prudent downgrade of a previously watch-listed real estate exposure”.

Specific allowances rose to 36 basis points (bps) of loans, from 20 bps a year earlier. This took full-year specific allowances to 19 bps, up from 13 bps, partially offset by a release of general allowances.

Chief executive Tan Su Shan said the bank is comfortable with its exposures and has “sufficient” general provision reserves.

“While rate pressures and geopolitical tensions are expected to persist, the quality of our franchise and strong balance sheet provide a solid foundation for the year ahead,”

she said.

For the full year, net profit fell 3% to S$10.93 billion. This reflected higher tax expenses following the implementation of the 15% global minimum tax.

Excluding the S$100 million in CSR commitments, full-year net profit would have been S$11.03 billion. This was below the S$11.27 billion consensus estimate from a Bloomberg survey of 15 analysts.

Looking ahead to 2026, Tan expects net profit to be slightly below 2025 levels, with total income around 2025 levels.

Group net interest income is likely to be marginally lower. This is due to further rate cuts and a strong Singapore dollar, partly offset by deposit growth.

The commercial book is expected to deliver high single-digit growth in non-interest income. Wealth management is expected to drive mid-teens growth.

Featured image credit: DBS