GXS Bank, a digital bank supported by Grab Holdings and Singtel, reported a substantial increase in losses for the financial year ending 31 December 2023, as reported by DealStreetAsia.
Despite this, the bank experienced a remarkable sixfold increase in net interest income, according to recent regulatory filings.
The bank’s losses expanded to S$208.2 million in 2023 from S$131.1 million the previous year.
Net interest income, which measures the difference between interest earned on loans and interest paid to depositors, increased to S$14.9 million from S$2.4 million. However, non-interest income decreased to S$1.18 million from S$2.6 million in 2022.
Overall, GXS Bank‘s total income tripled, reaching S$16.13 million in 2023, up from S$5.1 million in the prior year.
This growth was overshadowed by a 57% rise in operating expenses, which climbed to S$214.2 million, driven primarily by increased staff costs that surged to S$119.3 million from S$76.4 million.
Earlier this year, DealStreetAsia reported that Grab infused S$145.10 million ($109 million) into GXS Bank. In previous funding rounds, Grab injected S$137 million in July 2022 and about US$75.8 million in April 2022.
Since its launch in August 2022, GXS Bank has targeted both consumers and businesses, introducing savings pockets with 2.68% interest per annum and a main account with 2.38% interest. Customers can open up to eight savings pockets.
In April, the bank announced that its GXS FlexiLoan customers saved a total of S$4 million in interest over the past 12 months, with more than 100,000 loans disbursed since the loan’s launch in April 2023.
In 2023, GXS Bank extended S$95.4 million in unsecured retail loans to individuals in Singapore. The bank maintains adequate reserves to cover potential defaults, with non-performing loans amounting to S$905,189, which is less than 1% of the total loans. Customer deposits totaled S$492.98 million, making up the largest portion of its liabilities.
The financial services business unit of GXS Bank’s parent company, Grab, reported revenue growth in Q1 2024, driven by increased lending through GrabFin and digibank, along with improved monetisation of payment services.
Grab reported a 53% year-on-year increase in financial services revenue for Q1 2024, although total operating expenses for digibank rose 48% year-on-year due to the launch of GXBank.
In Singapore’s digital banking sector, other banks also saw growth despite rising losses. Ant Group-backed ANEXT Bank reported a 434% increase in loans to S$222 million in 2023 and a 368% rise in deposits to S$295 million.
Meanwhile, Maribank, founded by Sea Ltd in 2021, saw customer deposits jump to S$503.8 million in 2023 from S$2 million the previous year, with losses rising to S$52.17 million from S$40.4 million.
Trust Bank Singapore, launched in September 2022, recorded S$304.1 million in loans and advances to customers in 2023, a 261% increase, with losses increasing to S$128.37 million from S$124.7 million.
