DBS’s charge toward S$50 is a big moment for Singapore’s banking sector, but also a reminder that the easy gains may be behind us—at least for now. After an incredible 52% rise last year, this year’s 16% YTD move feels steadier but also riskier, especially as DBS now trades well above book value. That kind of premium only holds if the bank can keep growing earnings—but with margin pressure now accelerating, there are definitely cracks appearing beneath the surface.

A pullback after reaching new all-time highs wouldn’t be surprising at all. Profit-taking is normal at psychological milestones like S$50, and volatility could pick up quickly if upcoming earnings (from DBS or OCBC) disappoint. DBS’s own warnings about the impact of margin compression and rate headwinds show that even the strongest banks are feeling the squeeze. If loan growth slows or bad debt rises, it could trigger a much-needed correction—giving patient investors a better entry point down the road.

If you’ve been holding DBS for years, this is the kind of level where trimming makes sense, even if just to lock in some of those impressive gains. For new buyers, chasing at the highs rarely pays off—waiting for a pullback is often the better risk/reward move.

With OCBC reporting next week, attention will turn to whether it can manage margin pressure any better than DBS. If OCBC can demonstrate strong non-interest income, disciplined cost control, or outperformance in key regional markets, it might hold up better. But if the whole sector faces pressure, both stocks could see short-term weakness. My view: both banks are long-term winners, but after this run, I’m cautious—holding core positions, trimming into strength, and waiting for volatility to offer new opportunities.