To The Moon

🌟🌟🌟Even though the US markets were in the doldrums on Wednesday, the STI Index was up led by the local banks.  $DBS Group Holdings(D05.SI)$  hit an all time high of SGD 45.44, up 2.1%.  $ocbc bank(O39.SI)$  jumped 4.1% to close at SGD 17.55 while $UOB(U11.SI)$  rose SGD 37.80, up 2%.  What an amazing feat! 

All 3 banks already hit record highs a few times in 2024 due to their strong earnings and a higher for longer interest rate environment.  DBS, OCBC and UOB were the best performers in 2024 with the banking  sector posting total returns of 44%.  Their strong performance drove $STI ETF(ES3.SI)$  to gain almost 17% in 2024.  It was the best year since 2017.

Can DBS, OCBC and UOB go even higher in 2025?

In 2024, all 3 Singapore banks continued to demonstrate solid growth with no signs of slowing down.  All 3 banks recorded total income growth of over 11% for Q3 24.  However looking at 9M 24, DBS is well ahead with a 11% year over year growth  while OCBC is 8% year over year growth and UOB is 3% year over year growth.

In comparing Net Profit among the 3 banks, DBS recorded a year over year growth of 11% compared to OCBC at 9% and UOB at 5%.

When it comes to comparing Cost to Income (CIR) ratio, OCBC has the lowest at 38.5% while DBS stands at 39% and UOB is 42.4%.

In terms of CET-1 ratio, DBS is the highest at 17.2% compared to OCBC at 15.6% and UOB at 15.5.

Finally in terms of Dividends, for the latest 9M 24, DBS dividends is 28.5% higher than in 9M 23 while OCBC is 8% higher year over year and UOB is 7.5% higher.

The current dividend yield for DBS is 4.65%, while OCBC is 4.90% and UOB is 4.58%.  So OCBC is the highest.

All 3 banks expect wealth management and growing loan portfolio to drive earnings in 2025.  Singapore's growth as a global asset management hub with over SGD 5.4 trillion in assets under management, has  given the banks new avenues of growth.  Wealth management fees drove the banks' record profits on Q3 24 and the trend is expected  to continue well into 2025.

DBS' profit was supported by record fee income led by wealth management, higher treasury customer sales and strong market trading income.  Its net fee and commission income in Q3 24 was SGD 1.11 billion, up from SGD 843 million in the same period in 2023.  Wealth management fees rose 18% year over year to SGD 609 million from broad based growth in investment products. 

OCBC's increased wealth management activities lifted fee and trading income in Q3 24.  Net fee income rose 10% to SGD 508 million from SGD 461 million as wealth management fees climbed 25% from previous year. 

All 3 banks expect loan growth to accelerate in 2025 as interest rates come down.  With the recent signing of the Johor Singapore Special Economic Zone (SEZ) by  Prime Ministers  Lawrence Wong and Anwar Ibrahim on 7 January, OCBC and UOB will benefit as they have extensive network in the area.   The SEZ Agreement plans to expand 100 projects in 10 years and increase ease of doing business, resulting in more capital inflows in the region. 

I am very happy with the performance of DBS, OCBC and UOB.  My strategy of buying and holding these superb Singapore Bank Stocks is finally coming to fruition with capital growth.  In addition to that I am also receiving excellent dividends which is so much better than the interest I am receiving from my savings account and Singapore Treasury Bills. 

Go Long Go Strong Go DBS, OCBC and UOB! 🚀🚀🚀🌛🌛🌛🌈🌈🌈💰💰💰🇸🇬🇸🇬🇸🇬

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