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Three Things To Like About DBS

DBS logoIf you were taken into a bank lobby blindfolded, you would probably be hard pressed to know which bank you were actually in when the blindfold was removed because all banks look virtually the same from the inside. That is why some people say that a bank is a bank is a bank.

That might be true from a customer’s point of view. But from a financial perspective, there could be some notable difference. DBS Group  (SGX: D05), for instance, has a good mix of banking activities, which is the first thing to like about the bank. Around a third of its revenues are generated from consumer banking and wealth management. About half comes from institutional banking and the remainder from treasury activities.

A steady rise in the bottom-line is the second thing to like about the bank. In 2006, DBS reported a bottom-line profit of S$2.3b. By 2013, this had risen to S$3.6b. Over the same period, which includes the Great Financial Crisis, total deposits had risen from S$122b to S$293b. Meanwhile, total loans had risen from S$88b to S$252b. It was business as usual for DBS.

The third thing to like about DBS is its 16 years of unbroken dividend payments. As a cyclical company at the forefront of the economy, it is only natural to assume that its fortunes would ebb and flow with the economic cycle. But over the last decade-and-a half, DBS has never failed to distribute some of its profits to shareholders. The payout, which kicked off at $0.16 a share in 1997 had increased to S$0.58 last year.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore Director David Kuo doesn’t own shares in any companies mentioned.