UOB, DBS, OCBC – Annual Report 2009

The following numbers and ratios were extracted from the annual reports of OCBC, UOB and DBS for the year ended 31 December 2009.

 

 

OCBC

UOB

DBS

Profit attributable to shareholders

$1.96b(+12%)

$1.90b

(-1.8%)

$2.04b

(+6%)

Net interest income

$2.82b

(+2%)

$3.67b

(+2.7%)

$4.46b

(+4%)

Non-interest income

$1.99b

(+37%)

$1.73b

(+3.4%)

$2.15b

(+24%)

Net interest margin

2.23%

2.36%

2.02%

Earnings per share

59.4¢

$1.19

90¢

Return on equity

12.2%

11.9%

8.4%

Return on assets

1.35%

1.06%

0.79%

Dividends

28¢

60¢

56¢

Non-performing loan ratio

1.7%

2.2%

2.9%

Capital adequacy ratio tier 1

15.9%

14.0%

13.1%

Capital adequacy ratio total

16.4%

19%

16.7%

Net asset per share

$6.33

$11.17

$10.85

Price traded as at 31 Dec 2009

$9.10

$19.70

$15.4

Price to book ratio (times)

1.43

1.76

1.42

Price/Earning

15.3

16.5

17.1

Dividend Yield

3.07%

3.04%

3.6%

Current traded price 15/4/10

$9.17

$20.96

$15.60

 

In absolute dollar term, DBS made $2.04 billion of the shareholders followed by OCBC and UOB. Both net interest income and non-interest income were highest for DBS.

 

However using common size way of comparison, DBS did not come up tops. Net interest margin was the highest for UOB. UOB has got the highest earnings per share also. But OCBC scored well for return on equity (ROE) and return on assets (ROA) with DBS having the lowest numbers. Both ROE and ROA percentages show how each bank has been able to achieve returns on share capital funds employed and total funding (inclusive of liabilities and share capital) respectively.

 

As for non-performing loan ratio (NPL), DBS had the highest ratio and OCBC the lowest. This could be due to higher loan quantum offered by DBS and hence a higher likelihood of default for some borrowers.

 

As for capital adequacy ratio, all banks kept it high to weather another financial crisis, if at all. In terms of Tier 1 capital adequacy ratio, OCBC had the highest ratio and DBS had the lowest.

 

The Net asset per share as at 31 December 2009 was $6.33, $11.17 and $10.85 for OCBC, UOB and DBS respectively. Based on last traded share price as at 31 December 2009, the price to book ratio was the highest for UOB at 1.76 times. Both DBS and OCBC were similar.

 

In terms of historical price earnings ratio, the ascending order was OCBC (15.3), UOB (16.5) and DBS (17.1). As for dividend yield based on year end share prices, DBS pays the highest at 3.6 per cent followed by slightly above 3.0 per cent for OCBC and UOB.

 

Singapore local banks had weathered the financial crisis of 2008/09 pretty well. They are conservative and not risk takers compared to some US and European banks. Such conservatism adds optimism to shareholders and the rise of Asia will play well into the hands of the local banks.

 

Copyright © 2010, the author known as LKT in Singapore.

 

The material presented is intended to be general and written in layman’s language as much as it is possible. The author shall not be liable for any direct or consequential loss arising from any use of material written. Please seek professional advice from your financial advisor or financial institutions on material written covering financial matters.

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