Presentation: DBS Group Holdings 1Q 2002 Financial Results

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DBS Group Holdings

1Q 2002 Financial Results

Presentation to Media and Analysts

This presentation is available at www.dbs.com

April 29, 2002

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2

Highlights of 2002 progress (YoY incl acqn)

`

Total revenue

$1,024m

(1Q01 : $808m)

27%

Non-interest income

$355m

(1Q01 : $319m)

11%

Net interest income

$670m

(1Q01 : $489m)

37%

Operating expenses

$459m

(1Q01 : $383m)

20%

Operating profit

(a)

$565m

(1Q01 : $425m)

33%

(a) Exclude goodwill

Fee income

$193m

(1Q01 : $118m)

64%

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3

Highlights of 2002 progress (YoY excl acqn)

`

Total revenue

$785m

(1Q01 : $808m)

3%

Non-interest income

$254m

(1Q01 : $319m)

22%

Net interest income

$532m

(1Q01 : $489m)

9%

Operating expenses

$329m

(1Q01 : $383m)

15%

Operating profit

$456m

(1Q01 : $425m)

7%

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Highlights of 2002 progress (QoQ)

`

Total revenue

$1,024m

(4Q01 : $966m)

6%

Non-interest income

$355m

(4Q01 : $259m)

37%

Net interest income

$670m

(4Q01 : $707m)

5%

Operating expenses

$459m

(4Q01 : $516m)

11%

Operating profit

(a)

$565m

(4Q01 : $450m)

26%

(a) Exclude goodwill

Fee income

$193m

(4Q01 : $207m)

7%

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5

Net interest margin

2.02%

(2001 : 1.87%)

NPLs

5.9%

(2001 : 5.7%)

Most ratios improved

Cost-to-income

(a)

44.8%

(2001 : 49.1%)

Non-interest income /

operating income

34.6%

(2001 : 36.3%)

Cash ROA

(b)

0.91%

(2001 : 0.86%)

Cash ROE

(b)

10.12%

(2001 : 10.07%)

Loan-to-deposit

60.5%

(2001 : 63.9%)

Cash EPS (cents)

94

(2001 : 89)

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6

Strong operating income growth

(S$ million)

(S$ million) 1Q02DBS 4Q01DBS Change% 1Q01DBS Change %

Net interest income 670 707 (5.2) 489 36.9

Fee income 193 207 (7.1) 118 63.7

Non-interest Income 355 259 36.9 319 11.2

Total revenue 1,024 966 6.1 808 26.8

Operating expenses 459 516 (10.9) 383 19.9

Operating profit 565 450 25.6 425 33.0

Goodwill 68 68 (0.1) - NM

Provisions 96 87 10.3 38 154.5

NPAM 278 169 64.8 321 (13.5)

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7

(S$ million)

670

707

588

472

489

1.85%

1.69%

1.77%

2.11%

2.02%

1Q01

2Q01

3Q01

4Q01

1Q02

Net interest income Net interest margin (gross basis)

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8

Wealth management continues to grow

Sales Volume

256 359 436

502

951

116 64

48 141

107

0 200 400 600 800 1000 1200

1Q01 2Q01 3Q01 4Q01 1Q02

(a) Unit trusts include Horizon, Ei8ht, Up! and other DBSAM programmes while treasury investment products include Growth and structured notes

372 423

484

643

1,058

(S$ million)

Unit trusts / Treasury investment products (a)

Insurance / asset plan

795

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9

Emphasis on non-interest income produces

stronger returns

(a)

(%)

Non-interest Income to Operating Income

34.6

26.8

23.8

32.8

30.4

36.3

39.5

Dec 98 Dec 99 Dec 00 Dec 01 1Q01 4Q01 1Q02

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DBSH

(excl DHB and DBSV) (a) ₃₁₂ ₃₃₃ _(6.1) ₃₆₆ _(14.7)

DHB 96 105 (8.3) - NM

DBSV 46 38 23.4 17 172.9

Restructuring costs 4 40 (89.8) - NM

Total 459 516 (10.9) 383 19.9

Greater operating efficiency

(S$ million)

(a) Dao Heng Bank (“DHB”), DBS Vickers (“DBSV”)

DBS

1Q02 4Q01DBS Change% 1Q01DBS Change %

Group Operating Expenses

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11

383

366

364

329

337

1Q01

2Q01

3Q01

4Q01

1Q02

Cost control initiatives effective

(a) Normalized expenses exclude goodwill and impact of acquisitions

Period expenses (a)

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12

Net interest income 162 171 (5.3)

Fee income 47 50 (6.4)

Non-interest income 66 57 15.3

Total revenue 228 228 (0.1)

Operating expenses 96 124 (22.3)

Operating profit 131 104 26.3

Provisions 37 (2) NM

Net profit before tax 97 105 (7.7)

Net profit after tax 80 114 (30.0)

Total revenue 228 228 (0.1)

Provisions 37 (2) NM

Net profit before tax 97 105 (7.7)

Net profit after tax 80 114 (30.0)

Dao Heng Bank operating profits up

(S$ million) (a)

(S$ million) (a) _1Q02DHB _4Q01DHB _Change%

(a) Based on Singapore GAAP

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Net interest income 162 171 (5.3)

Total revenue 228 228 (0.1)

Provisions (a) ₁₀ ₃₀ _(66.1)

Net profit before tax 121 74 63.4

Total revenue 228 228 (0.1)

Provisions (a) ₁₀ ₃₀ _(66.1)

Net profit before tax 121 74 63.4

Dao Heng Bank with HK GAAP provisions

(S$ million)

(S$ million) _1Q02DHB 4Q01DHB _Change%

(a) Based on Hong Kong GAAP

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DBS Thai Danu Bank operating profits up

Net interest income 23 23 1.9 22 4.1

Fee income 5 5 (1.6) 4 24.7

Non-interest income 9 9 1.8 8 12.3

Total revenue 32 32 1.8 30 6.2

Operating expenses 22 22 2.1 22 3.0

Operating profit 10 10 1.3 8 14.4

Non-operating expenses 2 2 (1.2) 2 (13.5)

Provisions 5 5 - 5 9.1

Net profit after tax 3 2 6.4 1 81.0

Net interest income 23 23 1.9 22 4.1

Fee income 5 5 (1.6) 4 24.7

Non-interest income 9 9 1.8 8 12.3

Total revenue 32 32 1.8 30 6.2

Operating expenses 22 22 2.1 22 3.0

Operating profit 10 10 1.3 8 14.4

Non-operating expenses 2 2 (1.2) 2 (13.5)

Provisions 5 5 - 5 9.1

Net profit after tax 3 2 6.4 1 81.0

(S$ million) (a)

(a) Assume exchange rate of 1 baht to S$0.0423. Based on Thai GAAP

DTDB

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15

649

2,705 _2,425

1,735 1,730 1,610 _1,486 1,528 1,478

1,152

770 723 1,239

1,365

667 ₆₆₁

624 ₆₀₆ ₆₃₂ ₇₆₈

2,874

3,207

1,238 _1,191

1,143 _1,101 _1,004 ₉₉₅ 815

777 ₇₄₄ 699

642 ₆₀₇ ₆₀₅ ₅₆₃

267 366

5.9%

5.7%

6.0%

6.2%

7.3%

7.6%

13.0%

11.8%

2.7%

Dec 97 Dec 98 Dec 99 Dec 00 Mar 01 Jun 01 Sep 01 Dec 01 Mar 02

NPL quantum down slightly while NPL rate

marginally up

_{Dao Heng Bank}

DBS Thai Danu Bank Regional 5 Countries Others

Singapore

NBk NPLs / NBk Loans (%)

1,112 4,503 (S$ million) 7,086 8,149 4,834 4,577

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NPLs improving at major subsidiaries

(a)

(S$ million) 995 1,004 1,101 1,143 1,191 1,238 28.7% 29.8% 35.2% 38.0% 40.3% 42.7%

Dec 00 Mar 01 Jun 01 Sep 01 Dec 01 Mar 02

(a) Based on MAS guidelines

DBS Thai Danu

DBS Hong Kong

1,011 1,085 1,150 1,238 494 541 4.1% 4.3% 4.9% 5.2% 7.1% 8.3%

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Provision coverage stable at 60.4%

1,666 1,658

1,530 1,240 1,223 1,464

1,048

1,179 1,155 1,061 1,051

1,055

143.9% 142.5% 132.0% 146.5%

147.8% 129.9%

51.8% 52.8% 54.7% 58.7% 60.3% 60.4%

Dec 00 Mar 01 Jun 01 Sep 01 Dec 01 Mar 02

General Provisions (GP) Specific Provisions (SP)

SP+GP / NPLs (%)

SP+GP / Unsec NPLs (%)

2,286

2,721

(S$ million)

2,274

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18

2,576

4,952

3,086 3,094

546 906 921

621

358 520 488

3,508

5.9%

5.7%

7.6%

13.0%

-800 200 1200 2200 3200 4200 5200 6200 7200 8200

Dec 99

Dec 00

Dec 01

Mar 02

Percentage of doubtful and loss NPLs stable

Loss Doubtful

(S$ million) Substandard

8,149

4,411

4,512

NPLs / Loans (%)

(19)

19

15.7

14.4

12.2

12.5

4.5

5.2

3.5

0 4 8 12 16 20 24

Dec 99 Dec 00 Dec 01 Mar 02 _{Mar 02}

Proforma for Dao Heng 2nd tranche Mar 02 Proforma for Dao Heng 2nd tranche

Well buffered against risks

DBS Group Holdings Consolidated Capital Adequacy Ratio

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20

Buy-out of minorities in DBS Kwong On Bank

(a)

 Minorities agree to sell their 12.68% of

DKOB to DBS

 _{Purchase consideration of S$210.7 mm /}

HK$903.8 mm

 Purchase price per share is S$4.43 / HK$19

 Approximately 15 mm new DBSH shares (b)

would be issued to the minorities

Transaction Highlights

Minority shareholders have agreed to exchange their 12.68% stake for new DBSH shares

DBS’ shareholding in DKOB

(a) DBS owns 87% of DBS Group Holdings HK which in turn owns 100% of DKOB

(b) Computed using DBSH share price of S$13.92 (based on simple average closing price from April 10 to 23, 2002) and a cross HK$/S$ exchange rate of 4.2896

DBS’ shareholding (87.26%)

Remaining Minorities

(0.05%)

Shares to be acquired

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Operating profit 304 19 301%

Net profit after tax 234 16 278%

Total Assets 34,647 28,512 10%

Customer loans 23,979 17,281 18%

NPL ratio (%) (b) _2.7 _15.3 _58%

Credit cards in force 100,000 0 NM

Operating profit 304 19 301%

Net profit after tax 234 16 278%

Total Assets 34,647 28,512 10%

Customer loans 23,979 17,281 18%

NPL ratio (%) (b) 2.7 15.3 58%

Credit cards in force 100,000 0 NM

DKOB 2001

(HK$ million) DKOB1999 1999 - 2001CAGR

DBS Kwong On’s integration success

(a)

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22

Achieved

1Q02 Revised Target

Synergies to exceed original HK$540 million

estimates

Key Revenue Initiatives:

 _{Launch of new funds (knowledge sharing)}

 _{ALCO Liquidity Management}

 Cross-selling opportunities (eg, T&M, Private

banking, Equipment finance, Credit cards and other existing products)

Select Cost Initiatives:

 Accelerated implementation of branch closures

 _{Active capacity management largely through}

vacancies and attrition

 Back office and IT centralization

Total Synergies

HK$147.4 m HK$750 m (a)

46%

54% 60%

40%

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DBS Group Holdings

1Q 2002 Financial Results

Presentation to Media and Analysts

This presentation is available at www.dbs.com

April 29, 2002