UOBKH analyst Jonathan Koh maintained a “buy” call on the stock while noting that the bank’s net profit forecasts came in above expectations.
Koh believes DBS bank will continue to see NIM expansion after growing a “sizeable” 62 basis points year on year to 2.05 per cent in Q4 FY2022, due to higher interest rates.
The analyst was also confident in DBS’ recent growth from treasury income and investment gains, its stable asset quality as well as the fact that its return on equity reached a new quarterly high.
In his view, DBS’ management appeared more inclined to increase its regular quarterly dividend, although the bank does not rule out other avenues of returning capital to shareholders, including special dividends and share buyback.
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BullnBearTradingOP : UOBKH lifted its target price on the stock to S$45.80 from S$45.35, upon raising its earnings forecast by 2 per cent for FY2023 to factor in lower specific provisions. The new target is based on 2.03 times its FY2023 price-to-book ratio.