DBS Group, Singapore’s largest bank, expressed confidence in achieving a return on equity (ROE) of 15% to 17% in the medium term during its annual general meeting on March 28, 2024. CEO Piyush Gupta indicated that although interest rates have declined from 5.5% to what he described as a “new normal” of approximately 3%, the bank believes it can sustain strong profitability.

Key Drivers of Future Growth
Gupta highlighted several factors contributing to this optimistic outlook, including:

High ROE Businesses: DBS is focusing on expanding its wealth management and global transaction services sectors, which are expected to drive faster growth and enhance overall ROE.

Record Performance: Last year, DBS achieved a record ROE of 18%, positioning itself among the top global banks. In 2022, the ROE was recorded at 15%, showcasing a solid upward trend.

Strategic Investments
DBS plans to invest between S$300 million and S$500 million in its India operations over the next few years, aiming to develop profitable consumer and small to medium-sized enterprises (SME) banking businesses.

Expansion in China
The bank is also optimistic about opportunities in China’s Greater Bay Area and the broader Chinese market. Recently, DBS announced a deal to increase its stake in Shenzhen Rural Commercial Bank for S$376 million, signaling its commitment to growth in the region.

DBS’s proactive strategies and focus on high-return sectors reflect its determination to navigate changing economic landscapes while maintaining robust performance and growth.