Comparison of DBS, OCBC and UOB – FY 2013

All three local banks had released their full year financial results.

The table below shows comparisons using some key ratios and results.

DBS OCBC UOB
Net Profit $3,672m $2,768m $3,008m
Percentage change – 4.0% – 31.0% * +7.3%
EPS $1.50 $0.78 $1.84
ROE 10.8% 11.6% 12.3%
ROA 0.91% 1.05% 1.12%
Dividend (Total) 58 cents 34 cents 75 cents
Dividend payout ratio 38.6% 43.5% 40.7%
Share price 18.2.2014 $16.55 $9.55 $20.43
Dividend yield 3.50% 3.56% 3.67%
Net Asset Value per share $13.61 $8.33 ** $17.96 ^
Price Earnings Ratio 11.0 12.2 11.1
Price to Book ratio 1.21 1.14 1.13

Notes:
* OCBC had a divestment gains in 2012 of $1,168 m
** NAV of OCBC is after valuation surplus
^ based on revalued NAV for UOB
Dividend yield, Price Earnings ratio and Price to Book ratio are calculated using share price as at 18 February 2014 (two to three days after release of financial results of three banks).

Net Profits

UOB did particularly well for 2013. Net profit jumped 7.3% to $3,008 million. Both DBS and OCBC had profit reduced from a year ago. Core profit of OCBC (excluding divestment gains in 2012) declined 2.0%.

In terms of Return of Equity (ROE), UOB (12.3%) came in top followed by OCBC (11.6%) and then DBS (10.8%).

Dividend

UOB is proposing special dividend of 5 cents on top of ordinary dividend.

Dividend payout ratio for all three banks are: OCBC (43.5%), UOB (40.7%) and DBS (38.6%). DBS is the lowest.

In terms of dividend yield based on share price on 18 February 2014: UOB (3.67%), OCBC (3.56%) and DBS (3.50%).

Price Earnings Ratio and Price to Book ratio

Based on share price at 18 February 2014,
Price Earnings ratio: DBS (11.0), UOB (11.1), OCBC (12.2)
Price to Book ratio: UOB (1.13), OCBC (1.14), DBS (1.21)

Other Key Operating Ratios:

DBS * OCBC UOB
Net Interest Margin 1.62% 1.64% 1.72%
Non-performing loan ratio 1.1% 0.7% 1.1%
Total Capital Adequacy Ratio 16.3% 16.3% 16.6%
Non interest income to total income 37.6% 41.4% 38.7%
Loans to deposits 85.0% 85.7% 88.5%
Cash & Cash equivalent $10.9 b $19.3b $21.2b

* excludes one-time item

The best net interest margin comes from UOB at 1.72%.
Non-performing loan ratio is the lowest for OCBC (0.7%).
OCBC has the highest non-interest income to total income ratio at 41.4%.
Total capital adequacy ratio is nearly the same for all three banks.
UOB has higher loans to deposits ratio at 88.5%.

UOB has the most cash and cash equivalent amount at $21.2 billion with DBS having the lowest ($10.9 b). OCBC had $19.3b. Part of this could be used to pay for their proposed acquisition of Wing Hang Bank (if it is approved).

UOB share prices

UOB’s share price rose 51 cents on 17 Feb (Monday) first day on release of its result on last Friday. It continued to rise 2 cents on Tuesday and now it was up 25 cents at 3 pm today. In total, the price increase was 78 cents over a few days and this is not even cum dividend yet.

Copyright © 2014, limkimtong for Living Investment

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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2 Responses to Comparison of DBS, OCBC and UOB – FY 2013

  1. Mason Moore says:

    Can I have your approval to review this on my twitter?

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