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Breaking news: Temasek and DBS issues statement that CEO Piyush Gupta's job is safe
- Thread starter LITTLEREDDOT
- Start date
Fuck this shitskin. He should be decapitated, dismembered and disemboweled for all the fucked-ups DBAss caused under his watch.
$15mil per year DBS CEO : "If you start firing people every time something goes wrong, you will never build the kind of culture you want!"
The bank was slapped with higher capital requirements after the Monetary Authority of Singapore called the repeated inconveniences caused by the disruptions “unacceptable”.
Two earlier incidents involved software glitches, Mr Gupta said.
“The most recent thing was just coincidental,” he added, saying the bank’s infrastructure is robust.
https://www.straitstimes.com/business/dbs-considering-expansion-in-dubai-ceo-says
Then we would have a screw up culture and disruptive daily lifestyle
$15mil per year DBS CEO : "If you start firing people every time something goes wrong, you will never build the kind of culture you want!"
The bank was slapped with higher capital requirements after the Monetary Authority of Singapore called the repeated inconveniences caused by the disruptions “unacceptable”.
Two earlier incidents involved software glitches, Mr Gupta said.
“The most recent thing was just coincidental,” he added, saying the bank’s infrastructure is robust.
https://www.straitstimes.com/business/dbs-considering-expansion-in-dubai-ceo-says
MAS penalties on DBS won’t set the bank back, analysts say
FILE PHOTO: A DBS logo on their office building in Singapore, February 22, 2016. REUTERS/Edgar Su
Abigail Ng
03 Nov 2023SINGAPORE: The punishment meted out to DBS appears "minor" and not commensurate with the impact of the service disruptions to Singapore's biggest lender, including one where online banking and ATM services were down for hours, analysts said.
On Wednesday (Nov 1), the Monetary Authority of Singapore (MAS) said DBS would be barred from making non-essential IT changes and any acquisitions of new business ventures for six months.
DBS also will not be allowed to reduce the size of its branch and ATM networks until MAS is satisfied with the progress of the bank’s remediation plan.
And the financial regulator said it would continue to require DBS to apply a multiplier of 1.8 times to its risk-weighted assets for operational risk.
When asked if the penalties were reasonable, the National University of Singapore's Assistant Professor in Finance Ben Charoenwong said it was worth considering the impact that the disruptions had on customers.
DBS is the “go-to bank” for many Singaporeans – some of whom may not do business with any other institutions, he said.
“If they are unable to access their funds or process payments, the cost to those users is the foregone economic transactions,” he said. “From that perspective, it seems the (penalties) and additional capital requirements appear to be minor.”
In a research note published on Thursday, RHB Bank research analysts said the management team at DBS could give more details on the impact of MAS' regulatory action, when its third-quarter results are released.
“But the direct impact looks to involve higher opex (compliance cost, tech spending) and capex,” the analysts wrote, referring to operational expenditure and capital expenditure.
“In our view, the impact does not represent too much of a setback to DBS,” the analysts told CNA separately.
ACQUISITION PLANS?
The ban on acquiring new business ventures in the next six months may also have a limited impact on DBS, with five analysts telling CNA they were unaware of any upcoming acquisition plans.“We note that the group has been focusing on integrating LVB (Lakshmi Vilas Bank) and Citi Taiwan acquisitions as well as guiding for higher dividends,” said Mr Thilan Wickramasinghe, head of Singapore research at Maybank.
“To us, this indicates limited appetite for any material (mergers and acquisitions) in the near term,” he said.
DBS took over India’s Lakshmi Vilas Bank in late 2020 and completed its acquisition of Citi’s consumer banking business in Taiwan in August this year.
MAS will review the progress made by DBS after the six-month window, and may extend the duration of measures, vary the additional capital requirement or take further actions.
“NOT A BAD IDEA” TO NOT FINE DBS
MAS did not impose any punitive monetary actions on DBS, noted Dr Patrick Thng, former chief information officer for finance and treasury at the World Bank.“It’s not a bad idea in the sense that instead of fining DBS and taking the money, they asked DBS to use that money to fix their infrastructure problems,” he said.
“To some extent, I commend MAS, I think that’s quite commendable.”
DBS chief executive officer Piyush Gupta said the bank will set aside S$80 million (US$58.6 million) to enhance system resiliency.
Consulting firm Accenture conducted an independent review and found four main areas of weakness for DBS – technology risk governance and oversight, incident management, system resilience and change management.
To MAS, the board of directors and senior management play an important role in the oversight and management of technology risk, Dr Thng pointed out.
On that note, he said it was important for board members to have strong digital skills – beyond financial and business skills – to effectively steer the organisation.
“Many organisations, banks included, are not having enough people with digital experience on their boards,” he said, adding that it sometimes takes a disruption or outage to spur a company to find a board member with digital skills.
IMPACT ON DBS STOCK PRICE
Shares of DBS fell 1.12 per cent on Thursday, the first trading day after the penalties were announced by MAS.RHB Bank said it was possible that the decline was a reaction to the regulatory action, but pointed out that most banks' share prices slipped on the same day.
However, CGS-CIMB said DBS shares fell more than its peers on Thursday. UOB’s stock dipped 0.77 per cent, while OCBC fell 0.16 per cent.
Shares of DBS have fallen around 5 per cent so far this year, but analysts said it was not due to the service disruptions.
“(The year-to-date) share price movement is primarily driven by earnings and management’s outlook in relation to the interest rates, and less so by the outages, in our view,” CGS-CIMB said.
Mr Wickramasinghe of Maybank said material impact on earnings or dividends was unlikely in the near term. In the medium term, growth could be affected by how DBS addresses the root causes of the outages and how risk management and control functions are strengthened, he said.
“Five major digital disruptions in the space of a year does raise concerns on system reliability and risk management,” he said, adding that DBS Group’s growth and product distribution strategies were very digital-centric.
“More clarity will be needed on how these can be executed under the current situation.”
The only way is to teach the "owners " or people in control a lesson by removing them from power.
You voted 70% for their candidate and of course they will do nothing.
Ask yourself , which group of people ultimately control MAS and DBS?
When I was in the finance sector, one joke going around is that the Head of DBS is ranked higher than the Head of MAS in the civil service, juat like LHL is ranked above Tharman, so who is in charge ?
You voted 70% for their candidate and of course they will do nothing.
Ask yourself , which group of people ultimately control MAS and DBS?
When I was in the finance sector, one joke going around is that the Head of DBS is ranked higher than the Head of MAS in the civil service, juat like LHL is ranked above Tharman, so who is in charge ?
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Is this the next train load headed to S'pore?
"It is not the CEO's fault. Piyush needs to hire more CECA programmers to troubleshoot."
DBS will also set aside a special budget of $80 million to enhance system resiliency. ST PHOTO: GIN TAY
Prisca Ang
Nov 6, 2023
SINGAPORE – DBS Bank will hire more engineering talent in the coming months to troubleshoot issues that might lie deep within its technology systems, in response to a spate of disruptions that have plagued customers this year.
Chief executive officer Piyush Gupta said on Monday that four of the bank’s five major disruptions in 2023 were bug- or software-related.
“The big issue to me is, how do you make sure that you get good change control, because the reality is that as you use a lot of different systems and architecture, you will run into bugs,” he told reporters during the bank’s third-quarter results briefing on Monday.
Monetary Authority of Singapore (MAS) managing director Ravi Menon said last week in an interview that there are some deeper-seated issues that need to be resolved at the bank.
Responding to a question on Monday about what these issues are, Mr Gupta said: “One issue is to have the deep engineering talent, because in at least two or three of these incidents, the bug was so deep that we wouldn’t be able to pick it up.”
Several of the recent disruptions have boiled down to human error or software bugs in systems of the bank’s vendors, he noted.
Working with a vendor to resolve these problems takes time, he said. Instead, improving the depth of DBS’ engineering team will help it troubleshoot bugs better.
Mr Gupta said the bank is working on a comprehensive set of measures to deliver improved service availability and hopes to have a more robust recovery process by the end of the first quarter of 2024.
One measure is to put in place more rigorous and comprehensive processes to ensure that systems that are being developed work correctly. The bank will also set aside a special budget of $80 million to enhance system resiliency.
Another priority is to decouple the bank’s systems such that important services can still be accessed.
Its payment service, for example, operates on multiple tech systems. Decoupling its underlying infrastructure will allow customers to pay via the bank’s other digital banking platforms even if one of these channels fails.
“It’s hard to figure out why we are getting more bugs now than we have in the past,” said Mr Gupta. “It’s purely my speculation that post-Covid, people are working from home and I think there’s been more pressure on software quality in general around the world.”
DBS was barred last week by the country’s central bank from acquiring new businesses or making non-essential IT changes for six months to ensure it focuses on shoring up its digital banking services. It is also not allowed to reduce the number of its branches and automated teller machines (ATMs) during this time.
Asked whether the measures will affect business, Mr Gupta said the bank did not have new deals or business ventures planned, and has not reduced its branch or ATM network in recent years.
“We will have to defer some new product features, new products and services which we would normally have done.
“But in reality, we have to focus on building resiliency so we would not have been able to put resources (in those areas) anyway. The MAS measures give us a six-month window to consolidate (our processes).
“When you have good brakes, then you can run faster later.”
4 of the 5 major DBS disruptions in 2023 were bug or software-related: CEO Piyush Gupta
DBS will also set aside a special budget of $80 million to enhance system resiliency. ST PHOTO: GIN TAY
Prisca Ang
Nov 6, 2023
SINGAPORE – DBS Bank will hire more engineering talent in the coming months to troubleshoot issues that might lie deep within its technology systems, in response to a spate of disruptions that have plagued customers this year.
Chief executive officer Piyush Gupta said on Monday that four of the bank’s five major disruptions in 2023 were bug- or software-related.
“The big issue to me is, how do you make sure that you get good change control, because the reality is that as you use a lot of different systems and architecture, you will run into bugs,” he told reporters during the bank’s third-quarter results briefing on Monday.
Monetary Authority of Singapore (MAS) managing director Ravi Menon said last week in an interview that there are some deeper-seated issues that need to be resolved at the bank.
Responding to a question on Monday about what these issues are, Mr Gupta said: “One issue is to have the deep engineering talent, because in at least two or three of these incidents, the bug was so deep that we wouldn’t be able to pick it up.”
Several of the recent disruptions have boiled down to human error or software bugs in systems of the bank’s vendors, he noted.
Working with a vendor to resolve these problems takes time, he said. Instead, improving the depth of DBS’ engineering team will help it troubleshoot bugs better.
Mr Gupta said the bank is working on a comprehensive set of measures to deliver improved service availability and hopes to have a more robust recovery process by the end of the first quarter of 2024.
One measure is to put in place more rigorous and comprehensive processes to ensure that systems that are being developed work correctly. The bank will also set aside a special budget of $80 million to enhance system resiliency.
Another priority is to decouple the bank’s systems such that important services can still be accessed.
Its payment service, for example, operates on multiple tech systems. Decoupling its underlying infrastructure will allow customers to pay via the bank’s other digital banking platforms even if one of these channels fails.
“It’s hard to figure out why we are getting more bugs now than we have in the past,” said Mr Gupta. “It’s purely my speculation that post-Covid, people are working from home and I think there’s been more pressure on software quality in general around the world.”
DBS was barred last week by the country’s central bank from acquiring new businesses or making non-essential IT changes for six months to ensure it focuses on shoring up its digital banking services. It is also not allowed to reduce the number of its branches and automated teller machines (ATMs) during this time.
Asked whether the measures will affect business, Mr Gupta said the bank did not have new deals or business ventures planned, and has not reduced its branch or ATM network in recent years.
“We will have to defer some new product features, new products and services which we would normally have done.
“But in reality, we have to focus on building resiliency so we would not have been able to put resources (in those areas) anyway. The MAS measures give us a six-month window to consolidate (our processes).
“When you have good brakes, then you can run faster later.”
2.5 million transactions affected by recent DBS, Citibank outages; 810,000 login attempts failed
DBS and Citibank have to conduct thorough investigations and come up with a plan that will minimise future disruptions and outages. ST PHOTO: STEPHANIE YEOW
Chor Khieng Yuit
Senior Correspondent
Nov 6, 2023
SINGAPORE – Some 2.5 million payment and automated teller machine transactions could not be completed during the banking outages that hit DBS Bank and Citibank on Oct 14, causing widespread disruption to businesses and consumers, said Minister of State for Trade and Industry Alvin Tan on Monday.
Customers also made up to 810,000 failed attempts to access the digital banking platforms of both banks between 2.54pm that day and 4.47am the following day.
Providing the estimates on the impact of the outages in Parliament, Mr Tan said that both banks have fallen short of regulatory requirements to ensure that their critical information technology systems are resilient against prolonged disruptions.
The outages were caused by a fault in the cooling system of an Equinix data centre used by DBS and Citibank. While both activated disaster recovery and contingency plans, services were only fully restored in the early hours of Oct 15.
“While both banks conducted annual exercises to test the recovery of the IT systems at the backup data centres, the specific issues that led to the delays in system recovery on Oct 14 did not surface during those tests,” he added.
Mr Tan noted that the Monetary Authority of Singapore (MAS) has measures in place to uphold the “reliability and recoverability” of banking services.
Under the Banking Act, banks that are found to have breached MAS’ requirements on technology risk management can be fined up to $100,000. This will be increased to a maximum of $1 million in 2024, Mr Tan said.
MAS also uses other regulatory tools to address lapses in banks’ risk management, Mr Tan said. This includes imposing additional capital requirements and suspending certain bank activities.
He cited DBS as an example, and said the string of five disruptions to banking services in the last eight months was “unacceptable”.
MPs questioned whether the punitive measures imposed on DBS were enough.
Tampines GRC MP Desmond Choo said it is “nothing short of a slap on the wrist”.
Mr Tan noted that MAS took a tougher stance on DBS, by requiring it to hold additional regulatory capital.
Higher capital requirements mean DBS must hold more liquid capital, which could leave the bank with less money for dividends or investments.
“It is a drag on the return of capital which could in turn impact credit ratings, as well as the stock price of the bank,” Mr Tan said.
DBS also cannot undertake new acquisitions and has to pause non-essential IT changes for six months.
Mr Tan noted that the measures do not stop here. DBS and Citibank have to conduct thorough investigations and come up with a plan that will minimise future disruptions and outages.
He added that the banks will need to test their plans regularly to ensure they are able to recover within four hours in the event of another outage.
West Coast GRC MP Ang Wei Neng asked if MAS will consider asking banks that have been hit by outages to compensate customers directly.
Adding to his earlier point that “matters of compensation are better dealt with between the bank and its customers”, Mr Tan noted that consumers can hold financial institutions accountable for such incidents.
“If I am unable to pay using one of the financial services providers, then I go to the other one. I lose confidence in one, I go to the other one.”
Mr Tan added that consumers can also consider using different ways to pay, so they are not overly reliant on one financial provider for time-sensitive transactions.
During the Oct 14 disruption, some customers were able to switch to alternative payment methods or providers, or use cash.
The disruption also highlighted the importance of data centres to a bank’s operations.
Mr Tan said the Government is looking into ways to further strengthen the security and resilience of data centres.
Like other major jurisdictions, MAS currently does not regulate external data service providers, which are typically not financial institutions.
It is the bank’s duty to implement adequate risk controls and oversight over their data centre providers, so they can deliver on their financial services with minimal disruptions, he added.
This ex-CECA farker should have his citizenship revoked and salaries all clawed back and sent back to Yeendia's Ganges River.
Because Piyush made so much money for PAP/Temasek, he gets away with all cock-ups including frequent IT breakdowns.
DBS CEO Piyush Gupta expects that net profit in 2024 will be maintained at this year’s record level. PHOTO: ST FILE
Prisca Ang
NOV 6, 2023, 9:02 PM SGT
SINGAPORE – DBS Group Holdings on Monday reported quarterly earnings that beat forecasts and said it expects net profit next year to match 2023’s level amid challenges to loan growth and spillover from geopolitical tensions.
Singapore and South-east Asia’s largest lender posted a 16 per cent year-on-year rise in net profit to $2.59 billion for the third quarter.
Excluding one-time costs of $40 million from the integration of Citibank Taiwan, earnings rose 18 per cent to $2.63 billion, beating the $2.54 billion forecast by analysts in a Bloomberg poll.
The Taiwan unit was consolidated on Aug 12 and made DBS the largest foreign bank there by assets.
The board declared a dividend of 48 cents a share for the third quarter, unchanged from the previous quarter. This brings the dividend for the nine months to $1.38 a share.
Compared with the record earnings in the previous quarter, net profit was 2 per cent lower as the higher income was offset by increased expenses and higher allowances taken for exposure linked to a recent money laundering case here.
Major banks including DBS were creditors to investment companies linked to individuals arrested and charged in a major money laundering scandal involving more than $2.8 billion of assets, including properties, luxury cars and cash.
DBS chief executive Piyush Gupta disclosed that the bank had about $100 million in exposures to the money laundering case.
These were mostly property purchases or retail customer accounts used to finance properties, he said.
As a result of provisions “prudently taken” for the laundering case, specific allowances for expected credit losses jumped almost eight times from a year ago to $197 million, or 18 basis points of loans.
Mr Gupta added that the saga is unlikely to have a significant impact on Singapore’s wealth management scene, adding: “I think net new money flows have continued to be robust through the third quarter, and they continue to be fairly solid in October as well.”
Meanwhile, the bank’s non-performing loan ratio stood at 1.2 per cent, unchanged from the previous quarter.
General allowances of $18 million were set aside for potential bad loans, compared with $153 million taken a year ago.
“We are not seeing any major pickup in delinquencies or stresses in any of our portfolios. If the world gets much worse, we have enough GP (general provision) cushion,” Mr Gupta said.
He noted that the net interest margin (NIM) – a key gauge of a lender’s profitability – rose for the seventh consecutive quarter on the back of higher interest rates.
But, while higher-for-longer rates support margins, there will be a likely trade-off with loan growth, he told a media briefing on Monday.
Higher interest rates have weighed on customers’ appetite for loans, which at DBS grew just 1 per cent, or $5 billion, in constant-currency terms from the previous quarter, to $420 billion.
This came even as the NIM of 2.82 per cent was stable from the previous quarter, expanding 52 basis points from a year ago.
For 2024, Mr Gupta said there is uncertainty from macroeconomic slowdown and geopolitical risks, but he expects net profit will be maintained at 2023’s record level.
While further rate hikes are unlikely, high interest rates are unlikely to come down until the second half of 2024, weighing on growth in Western economies. China’s recovery also remains patchy, he said.
The bank is also keeping an eye on the indirect impact of Middle East tensions on oil prices, and the potential trade deficit of oil importers in Asia.
A bright spot is the momentum in fee income, which will likely be sustained by wealth management and cards, Mr Gupta said.
The Citi Taiwan integration will also help, with DBS noting that the business has boosted its credit card accounts in Taiwan by fivefold to more than three million, and tripled investment assets under management to more than $12 billion.
At home, the bank is focusing on shoring up measures to respond to its spate of digital disruptions in 2023, in areas like system recovery and technology risk governance.
“We will dedicate ourselves to executing the comprehensive set of measures we recently announced to address the series of digital disruptions, for which we are truly sorry. We are committed to strengthening our technology resilience and ensuring customer service reliability,” Mr Gupta said.
DBS’ total income in the third quarter rose 16 per cent year on year to a record $5.19 billion.
Net interest income for the bank’s commercial book grew 23 per cent year on year to $3.68 billion in the third quarter.
The consolidation of Citi Taiwan contributed $10 billion to loans, but excluding the unit, non-trade corporate loans declined 1 per cent, or $2 billion, from the previous quarter from higher repayments, while trade loans fell 3 per cent, or $1 billion, due to unattractive pricing.
Housing and other consumer loans were 1 per cent, or $1 billion, lower quarter on quarter.
Deposits grew 2 per cent, or $12 billion, in constant-currency terms from the previous quarter to $531 billion due to the consolidation of Citi Taiwan.
But underlying deposits were unchanged as a fall in current and savings account deposits was offset by an increase in fixed deposits.
Net fee income rose 9 per cent to $843 million year on year on the back of higher wealth management fees from the sales of bancassurance and investment products.
Card fees grew 21 per cent to $269 million year on year from higher spending by consumers and the integration of Citi Taiwan, while loan-related fees rose 12 per cent to $137 million.
Transaction fees were little changed at $228 million, while investment banking fees fell 16 per cent to $21 million due to slower capital market activities.
Other non-interest income rose 8 per cent from a year ago to $499 million from higher treasury customer sales.
DBS shares closed 1.4 per cent higher at $33.75 on Monday, while UOB climbed 1.05 per cent to $28 and OCBC rose 1.1 per cent to $13.15.
UOB on Oct 26 reported that its core earnings rose 5 per cent year on year to $1.48 billion. OCBC will post its results on Friday.
DBS had $100m exposure to money laundering bust; Q3 profit of $2.63b beats forecasts
DBS CEO Piyush Gupta expects that net profit in 2024 will be maintained at this year’s record level. PHOTO: ST FILE
Prisca Ang
NOV 6, 2023, 9:02 PM SGT
SINGAPORE – DBS Group Holdings on Monday reported quarterly earnings that beat forecasts and said it expects net profit next year to match 2023’s level amid challenges to loan growth and spillover from geopolitical tensions.
Singapore and South-east Asia’s largest lender posted a 16 per cent year-on-year rise in net profit to $2.59 billion for the third quarter.
Excluding one-time costs of $40 million from the integration of Citibank Taiwan, earnings rose 18 per cent to $2.63 billion, beating the $2.54 billion forecast by analysts in a Bloomberg poll.
The Taiwan unit was consolidated on Aug 12 and made DBS the largest foreign bank there by assets.
The board declared a dividend of 48 cents a share for the third quarter, unchanged from the previous quarter. This brings the dividend for the nine months to $1.38 a share.
Compared with the record earnings in the previous quarter, net profit was 2 per cent lower as the higher income was offset by increased expenses and higher allowances taken for exposure linked to a recent money laundering case here.
Major banks including DBS were creditors to investment companies linked to individuals arrested and charged in a major money laundering scandal involving more than $2.8 billion of assets, including properties, luxury cars and cash.
DBS chief executive Piyush Gupta disclosed that the bank had about $100 million in exposures to the money laundering case.
These were mostly property purchases or retail customer accounts used to finance properties, he said.
As a result of provisions “prudently taken” for the laundering case, specific allowances for expected credit losses jumped almost eight times from a year ago to $197 million, or 18 basis points of loans.
Mr Gupta added that the saga is unlikely to have a significant impact on Singapore’s wealth management scene, adding: “I think net new money flows have continued to be robust through the third quarter, and they continue to be fairly solid in October as well.”
Meanwhile, the bank’s non-performing loan ratio stood at 1.2 per cent, unchanged from the previous quarter.
General allowances of $18 million were set aside for potential bad loans, compared with $153 million taken a year ago.
“We are not seeing any major pickup in delinquencies or stresses in any of our portfolios. If the world gets much worse, we have enough GP (general provision) cushion,” Mr Gupta said.
He noted that the net interest margin (NIM) – a key gauge of a lender’s profitability – rose for the seventh consecutive quarter on the back of higher interest rates.
But, while higher-for-longer rates support margins, there will be a likely trade-off with loan growth, he told a media briefing on Monday.
Higher interest rates have weighed on customers’ appetite for loans, which at DBS grew just 1 per cent, or $5 billion, in constant-currency terms from the previous quarter, to $420 billion.
This came even as the NIM of 2.82 per cent was stable from the previous quarter, expanding 52 basis points from a year ago.
For 2024, Mr Gupta said there is uncertainty from macroeconomic slowdown and geopolitical risks, but he expects net profit will be maintained at 2023’s record level.
While further rate hikes are unlikely, high interest rates are unlikely to come down until the second half of 2024, weighing on growth in Western economies. China’s recovery also remains patchy, he said.
The bank is also keeping an eye on the indirect impact of Middle East tensions on oil prices, and the potential trade deficit of oil importers in Asia.
A bright spot is the momentum in fee income, which will likely be sustained by wealth management and cards, Mr Gupta said.
The Citi Taiwan integration will also help, with DBS noting that the business has boosted its credit card accounts in Taiwan by fivefold to more than three million, and tripled investment assets under management to more than $12 billion.
At home, the bank is focusing on shoring up measures to respond to its spate of digital disruptions in 2023, in areas like system recovery and technology risk governance.
“We will dedicate ourselves to executing the comprehensive set of measures we recently announced to address the series of digital disruptions, for which we are truly sorry. We are committed to strengthening our technology resilience and ensuring customer service reliability,” Mr Gupta said.
DBS’ total income in the third quarter rose 16 per cent year on year to a record $5.19 billion.
Net interest income for the bank’s commercial book grew 23 per cent year on year to $3.68 billion in the third quarter.
The consolidation of Citi Taiwan contributed $10 billion to loans, but excluding the unit, non-trade corporate loans declined 1 per cent, or $2 billion, from the previous quarter from higher repayments, while trade loans fell 3 per cent, or $1 billion, due to unattractive pricing.
Housing and other consumer loans were 1 per cent, or $1 billion, lower quarter on quarter.
Deposits grew 2 per cent, or $12 billion, in constant-currency terms from the previous quarter to $531 billion due to the consolidation of Citi Taiwan.
But underlying deposits were unchanged as a fall in current and savings account deposits was offset by an increase in fixed deposits.
Net fee income rose 9 per cent to $843 million year on year on the back of higher wealth management fees from the sales of bancassurance and investment products.
Card fees grew 21 per cent to $269 million year on year from higher spending by consumers and the integration of Citi Taiwan, while loan-related fees rose 12 per cent to $137 million.
Transaction fees were little changed at $228 million, while investment banking fees fell 16 per cent to $21 million due to slower capital market activities.
Other non-interest income rose 8 per cent from a year ago to $499 million from higher treasury customer sales.
DBS shares closed 1.4 per cent higher at $33.75 on Monday, while UOB climbed 1.05 per cent to $28 and OCBC rose 1.1 per cent to $13.15.
UOB on Oct 26 reported that its core earnings rose 5 per cent year on year to $1.48 billion. OCBC will post its results on Friday.
It seems the natural reaction for bosses to throw their subordinates under the bus when "shit hits the fan".
Forum: DBS should not put profits ahead of customer service
Nov 9, 2023DBS Bank’s strong financial performance has been welcomed by both shareholders and employees, spelling dividends and bonuses (DBS’ Q3 profit up 18% to $2.63b, surpassing analysts’ expectations, Nov 7).
Customers, however, may be less enthusiastic. The good performance may, in part, be due to the steady reduction of physical branches and customer-facing staff, and an increasing shift towards online transactions.
This happens under the rubric of digitalisation and ease of transaction, but conveniently takes much cost out of the business. Queue times at the bank’s remaining branches can be long, and responses slow when reaching out to its call centre for help.
We have seen how vulnerable the DBS online platforms can be to disruptions, and the fines that have been imposed on the bank for the outages seem trifling compared with its profits.
Even as the bank modernises its services, the balance between cost-efficiency and customer service should be adjusted to favour the customer, if necessary, over profits.
DBS is a business that needs to be profitable, but as Singapore’s largest bank, it has a responsibility to consider the interests of its customers, who are also vital stakeholders.
On a positive note, I must commend DBS staff. Those I have encountered have always been polite, helpful and efficient, and are a credit to the bank.
Philip Roberts
CEO of Optus resigned to take responsibility for the outage.
DBS CEO Piyush Gupta should also resign to take responsibility.
Ms Kelly Bayer Rosmarin faced intense questioning in an Australian Senate inquiry hearing on Nov 17, during which she dodged questions about whether she would resign. PHOTO: EPA-EFE
Ann Williams
Assistant Business Editor
NOV 20, 2023
SINGAPORE – Singtel announced on Nov 20 that the chief executive officer of its Australian subsidiary Optus, Ms Kelly Bayer Rosmarin, has resigned – a little over a week after a nationwide outage left about 10 million Australians without phone or Internet access for 12 hours.
Optus chief financial officer Michael Venter will concurrently take on the role of interim CEO as the company embarks on a global search for a new head, Singtel said.
Former StarHub CEO Peter Kaliaropoulos has been appointed chief operating officer – a newly created position. Mr Kaliaropoulos, who was previously Optus’ business managing director, will rejoin the company on Nov 22 and report to Mr Venter.
Singtel group CEO Yuen Kuan Moon said in a statement: “We recognise the need for Optus to regain customer trust and confidence as the team works through the impact and consequences of the recent outage and continues to improve.
“Optus is an integral part of our group’s business. We view the events in recent weeks very seriously. We fully recognise the importance of Optus’ role in providing connectivity services to the community and the importance of network resiliency and security. That is a top priority in all markets where our companies operate in.”
Mr Yuen also said he has every confidence that the Optus team will exert all efforts to deliver for customers and regain their trust and confidence.
On the CEO’s departure, he said: “Optus appointed Kelly at the beginning of the pandemic, and we acknowledge her leadership, commitment and hard work throughout what has been a challenging period and thank her for her dedication and service to Optus.”
The Nov 8 outage hit Australia’s second-largest telco a little more than a year after it suffered a major cyber attack in which more than two million customers had their personal data, such as passport details, breached.
Singtel said last week that its routine software upgrade was not the root cause of the outage, contradicting Optus’ initial claims. Optus later said the fault lay in the failure of its own safety mechanisms when responding to the software upgrade.
Singtel had stuck by the Optus boss following the hack, but the outage led to public backlash in Australia and a stock sell-off in Singapore, and made Ms Bayer Rosmarin’s position less tenable, Bloomberg reported.
Ms Bayer Rosmarin faced intense questioning in an Australian Senate inquiry hearing on Nov 17, during which she dodged questions about whether she would resign.
In the statement on Monday, she said; “Having now had time for some personal reflection, I have come to the decision that my resignation is in the best interest of Optus moving forward.”
The telco has offered at least 200GB of extra data to affected customers as it faces investigations and calls for class-action lawsuits over the outage.
Former StarHub CEO Peter Kaliaropoulos has been appointed Optus’ chief operating officer – a newly created position. PHOTO: LIANHE ZAOBAO FILE
Optus and its CEO were slammed for its slow response and lack of communication about the massive outage. Ms Bayer Rosmarin had told Friday’s Senate hearing that the telco intentionally did not contact customers directly during the outage, and instead prioritised posting on social media and doing live media interviews.
In a comment that was perceived as tone-deaf and out of touch, Ms Bayer Rosmarin appeared to make light of the outage’s impact on thousands of small business owners.
“I’m disappointed that a barber couldn’t do haircuts today,” she told Nine News on the day of the outage. “That seems like one of the few things you can do without connectivity.”
In an interview with radio station 2GB, also on the day of the outage, the then CEO also suggested that “customers could’ve checked the Optus website” to learn more about the situation.
Singtel shares fell when trading opened on Nov 20 and closed down two cents, or 0.9 per cent, at $2.31.
DBS CEO Piyush Gupta should also resign to take responsibility.
CEO of Singtel-owned Optus resigns following Australia-wide outage
Ms Kelly Bayer Rosmarin faced intense questioning in an Australian Senate inquiry hearing on Nov 17, during which she dodged questions about whether she would resign. PHOTO: EPA-EFE
Ann Williams
Assistant Business Editor
NOV 20, 2023
SINGAPORE – Singtel announced on Nov 20 that the chief executive officer of its Australian subsidiary Optus, Ms Kelly Bayer Rosmarin, has resigned – a little over a week after a nationwide outage left about 10 million Australians without phone or Internet access for 12 hours.
Optus chief financial officer Michael Venter will concurrently take on the role of interim CEO as the company embarks on a global search for a new head, Singtel said.
Former StarHub CEO Peter Kaliaropoulos has been appointed chief operating officer – a newly created position. Mr Kaliaropoulos, who was previously Optus’ business managing director, will rejoin the company on Nov 22 and report to Mr Venter.
Singtel group CEO Yuen Kuan Moon said in a statement: “We recognise the need for Optus to regain customer trust and confidence as the team works through the impact and consequences of the recent outage and continues to improve.
“Optus is an integral part of our group’s business. We view the events in recent weeks very seriously. We fully recognise the importance of Optus’ role in providing connectivity services to the community and the importance of network resiliency and security. That is a top priority in all markets where our companies operate in.”
Mr Yuen also said he has every confidence that the Optus team will exert all efforts to deliver for customers and regain their trust and confidence.
On the CEO’s departure, he said: “Optus appointed Kelly at the beginning of the pandemic, and we acknowledge her leadership, commitment and hard work throughout what has been a challenging period and thank her for her dedication and service to Optus.”
The Nov 8 outage hit Australia’s second-largest telco a little more than a year after it suffered a major cyber attack in which more than two million customers had their personal data, such as passport details, breached.
Singtel said last week that its routine software upgrade was not the root cause of the outage, contradicting Optus’ initial claims. Optus later said the fault lay in the failure of its own safety mechanisms when responding to the software upgrade.
Singtel had stuck by the Optus boss following the hack, but the outage led to public backlash in Australia and a stock sell-off in Singapore, and made Ms Bayer Rosmarin’s position less tenable, Bloomberg reported.
Ms Bayer Rosmarin faced intense questioning in an Australian Senate inquiry hearing on Nov 17, during which she dodged questions about whether she would resign.
In the statement on Monday, she said; “Having now had time for some personal reflection, I have come to the decision that my resignation is in the best interest of Optus moving forward.”
The telco has offered at least 200GB of extra data to affected customers as it faces investigations and calls for class-action lawsuits over the outage.
Former StarHub CEO Peter Kaliaropoulos has been appointed Optus’ chief operating officer – a newly created position. PHOTO: LIANHE ZAOBAO FILE
Optus and its CEO were slammed for its slow response and lack of communication about the massive outage. Ms Bayer Rosmarin had told Friday’s Senate hearing that the telco intentionally did not contact customers directly during the outage, and instead prioritised posting on social media and doing live media interviews.
In a comment that was perceived as tone-deaf and out of touch, Ms Bayer Rosmarin appeared to make light of the outage’s impact on thousands of small business owners.
“I’m disappointed that a barber couldn’t do haircuts today,” she told Nine News on the day of the outage. “That seems like one of the few things you can do without connectivity.”
In an interview with radio station 2GB, also on the day of the outage, the then CEO also suggested that “customers could’ve checked the Optus website” to learn more about the situation.
Singtel shares fell when trading opened on Nov 20 and closed down two cents, or 0.9 per cent, at $2.31.
See, told you Piyush Gupta is unsackable.
DBS' full-year 2023 earnings rose 26 per cent to $10.3 billion. PHOTO: ST FILE
Angela Tan
Senior Correspondent
Feb 7, 2024
SINGAPORE - DBS Group Holdings, the largest bank in South-east Asia by assets, reported on Feb 7 record earnings for 2023, with the board proposing a one-for-10 bonus issue.
Net profit rose 2 per cent year on year to $2.39 billion in the October to December quarter. This boosted full-year 2023 earnings by 26 per cent to $10.3 billion.
Analysts in a Bloomberg poll had projected net profit of around $2.4 billion for the fourth quarter, and $10.3 billion for the full year.
The board has proposed a final dividend of 54 cents per share for the fourth quarter, an increase of six cents from the previous payout.
This brings the ordinary dividend for 2023 to $1.92 per share, an increase of 42 cents from the previous year.
In addition, DBS’s board is proposing a 1-for-10 bonus issue, meaning one bonus share for every 10 held. The bonus shares will qualify for dividends, starting from the first-quarter 2024 interim dividend, and will increase the pace of capital returns to shareholders, the bank said.
Barring unforeseen circumstances, the annualised ordinary dividend going forward will be $2.16 per share over the enlarged share base, which represents a 24 per cent increase from $1.92 per share for financial year 2023.
Based on DBS’ closing price on Feb 6, the post-bonus annualised dividend yield would be 7.5 per cent.
Shares of DBS, the first local bank to post its fourth-quarter results, closed at $31.65 on Feb 6, down 20 cents or 0.6 per cent.
DBS Q4 profit up 2% to $2.39 billion, proposes 1-for-10 bonus issue
DBS' full-year 2023 earnings rose 26 per cent to $10.3 billion. PHOTO: ST FILE
Angela Tan
Senior Correspondent
Feb 7, 2024
SINGAPORE - DBS Group Holdings, the largest bank in South-east Asia by assets, reported on Feb 7 record earnings for 2023, with the board proposing a one-for-10 bonus issue.
Net profit rose 2 per cent year on year to $2.39 billion in the October to December quarter. This boosted full-year 2023 earnings by 26 per cent to $10.3 billion.
Analysts in a Bloomberg poll had projected net profit of around $2.4 billion for the fourth quarter, and $10.3 billion for the full year.
The board has proposed a final dividend of 54 cents per share for the fourth quarter, an increase of six cents from the previous payout.
This brings the ordinary dividend for 2023 to $1.92 per share, an increase of 42 cents from the previous year.
In addition, DBS’s board is proposing a 1-for-10 bonus issue, meaning one bonus share for every 10 held. The bonus shares will qualify for dividends, starting from the first-quarter 2024 interim dividend, and will increase the pace of capital returns to shareholders, the bank said.
Barring unforeseen circumstances, the annualised ordinary dividend going forward will be $2.16 per share over the enlarged share base, which represents a 24 per cent increase from $1.92 per share for financial year 2023.
Based on DBS’ closing price on Feb 6, the post-bonus annualised dividend yield would be 7.5 per cent.
Shares of DBS, the first local bank to post its fourth-quarter results, closed at $31.65 on Feb 6, down 20 cents or 0.6 per cent.
His job is safe. Cut salary only.
His salary is now only $11.3 million.
Poor fella.
DBS CEO Piyush Gupta took a deeper cut of 30 per cent, which amounted to $4.14 million. ST PHOTO: AZMI ATHNI
Angela Tan
Senior Correspondent
Feb 7, 2024
SINGAPORE - The 2023 variable compensation for DBS Group Holdings chief executive officer Piyush Gupta and other members of the lender’s group management committee has been cut to hold them accountable for the series of digital disruptions in 2023.
Mr Gupta took a deeper cut of 30 per cent, which amounted to $4.14 million, DBS said on Feb 7 in its fourth-quarter earnings statement. The DBS CEO earned $15.4 million in 2022.
Collectively, the bank’s management committee saw their 2023 variable compensation reduced by 21 per cent from the previous year, despite record profits for 2023.
However, to help lower-income employees cope with higher costs of living, junior employees across the group, who make up half of the total headcount, will receive a one-time bonus. A total of $15 million was set aside for this in expenses for 2023.
DBS also said in its Feb 7 statement that it has made a “whole-of-bank” effort and committed $80 million to improving its technology.
These efforts will enable the bank to better pre-empt disruptions to its services, provide customers with alternate channels for payments and account enquiries during disruptions, and shorten incident recovery time, it said.
Going forward, the bank will continue with its investments to sustain efforts to provide reliable services to customers, it added.
As a result of the disruptions at DBS in 2023, the Monetary Authority of Singapore imposed a six-month pause on the bank’s non-essential IT changes on Nov 1 to ensure the bank keeps a tight focus on restoring the resilience of its digital banking services.
During this time, DBS is not allowed to acquire new business ventures or reduce the size of its branch and ATM networks in Singapore.
DBS had said then that it would hold senior management accountable for the lapses, with it being reflected in their compensation.
Mr Gupta’s 2022 pay of $15.4 million consisted of a salary of $1.5 million, a cash bonus of $5.77 million and deferred remuneration in cash and shares of $8.04 million. A non-cash component – comprising club, car and driver benefits – worth $80,529 was also part of his pay package, according to the bank’s annual report.
His salary is now only $11.3 million.
Poor fella.
DBS CEO Piyush Gupta gets 30% cut in 2023 variable pay over bank’s digital disruptions
DBS CEO Piyush Gupta took a deeper cut of 30 per cent, which amounted to $4.14 million. ST PHOTO: AZMI ATHNI
Angela Tan
Senior Correspondent
Feb 7, 2024
SINGAPORE - The 2023 variable compensation for DBS Group Holdings chief executive officer Piyush Gupta and other members of the lender’s group management committee has been cut to hold them accountable for the series of digital disruptions in 2023.
Mr Gupta took a deeper cut of 30 per cent, which amounted to $4.14 million, DBS said on Feb 7 in its fourth-quarter earnings statement. The DBS CEO earned $15.4 million in 2022.
Collectively, the bank’s management committee saw their 2023 variable compensation reduced by 21 per cent from the previous year, despite record profits for 2023.
However, to help lower-income employees cope with higher costs of living, junior employees across the group, who make up half of the total headcount, will receive a one-time bonus. A total of $15 million was set aside for this in expenses for 2023.
DBS also said in its Feb 7 statement that it has made a “whole-of-bank” effort and committed $80 million to improving its technology.
These efforts will enable the bank to better pre-empt disruptions to its services, provide customers with alternate channels for payments and account enquiries during disruptions, and shorten incident recovery time, it said.
Going forward, the bank will continue with its investments to sustain efforts to provide reliable services to customers, it added.
As a result of the disruptions at DBS in 2023, the Monetary Authority of Singapore imposed a six-month pause on the bank’s non-essential IT changes on Nov 1 to ensure the bank keeps a tight focus on restoring the resilience of its digital banking services.
During this time, DBS is not allowed to acquire new business ventures or reduce the size of its branch and ATM networks in Singapore.
DBS had said then that it would hold senior management accountable for the lapses, with it being reflected in their compensation.
Mr Gupta’s 2022 pay of $15.4 million consisted of a salary of $1.5 million, a cash bonus of $5.77 million and deferred remuneration in cash and shares of $8.04 million. A non-cash component – comprising club, car and driver benefits – worth $80,529 was also part of his pay package, according to the bank’s annual report.
Piyush Gupta must act fast to cement his legacy at DBS
Andy Mukherjee
In full-year earnings on Feb 7, Mr Piyush Gupta promised to eliminate single points of failure for key services during the current quarter. PHOTO: BLOOMBERG
Feb 8, 2024
SINGAPORE - It is rare for a bank boss to take a 30 per cent cut in variable pay – after delivering a chart-topping return on equity of 18 per cent.
In doing just that, Mr Piyush Gupta, the chief executive at DBS Group Holdings, has acknowledged the role of small things – like an overheated data centre – in making a bank good, average or bad in the digital age.
But the $4 million hit to salary also shows how far Singapore’s largest lender is from realising its CEO’s ambition.
Under Mr Gupta, DBS has always aspired to be less of a bank and more of a technology powerhouse. And not just any tech firm, but one that would rank alongside some of the world’s most admired brands. As DBS told McKinsey & Co, the plan was to borrow the initials of Google, Amazon, Netflix, Apple, LinkedIn and Facebook, supply the missing D, and voila: You have Gandalf from The Lord Of The Rings.
Trouble is, after more than 14 years leading DBS, the wizard of Asian banking is running out of time: Succession is on the horizon. To cement his legacy as the banker who inserted DBS into Gandalf, the CEO has to act fast. In full-year earnings on Feb 7, Mr Gupta promised to eliminate single points of failure for key services during the current quarter. The bank is also close to appointing a chief information officer, he said.
Stalled ATM transactions and other tech disruptions became DBS’ Achilles heel in what was otherwise a much better year than I had anticipated. Trouble in United States regional banking failed to derail the Federal Reserve’s campaign to keep interest rates higher for longer. That helped DBS extract a juicy profit margin on its loans. On its home turf, elevated borrowing costs failed to deter first-time local homebuyers. Mortgage demand in Singapore has been trending lower since end-2021, but it has not fallen off the cliff.
Yet, before the results, DBS shares were down nearly 12 per cent in one year, the worst among the Asian financial centre’s three home-grown banks. The stock closed up 2.5 per cent on Feb 7.
It was not big credit mishaps or spectacular interest rate miscalculations that hobbled performance, but everyday operational snafus. In the end, 2023 will be remembered as the year in which DBS annoyed its customers and regulator, and suffered business and reputational damage that were not expected from what Euromoney magazine named the world’s best digital bank in 2016.
The infirmities should have been addressed right after digital services failed for two days in 2021. Now DBS is playing catch-up in a somewhat less favourable environment. All lenders with exposure to China are anxious about the mainland’s deteriorating economy and its repercussions for the rest of the world. Though Mr Gupta is still projecting a strong return on equity of 15 to 17 per cent this year, there would be a tradeoff between profitability and growth. Net interest margin is expected to slow slightly from 2.1 per cent in the December quarter, but loan growth may hum along, aided by the lender’s acquisition of Citigroup’s consumer business in Taiwan.
Credit quality remains stable, meanwhile. With the nonperforming loan ratio currently at 1.1 per cent, there is plenty of cushion to make provisions for losses without having to slow investment in technology, which must be Mr Gupta’s top priority for the year.
It is unfortunate that when the tech world – titans and start-ups alike – is all excited over generative artificial intelligence, DBS should be stuck with a version of what American psychologist Frederick Herzberg described as a “hygiene factor”: A bank app that works 24x7 will not motivate customers to use it more often; but one glitchy experience can leave them miserable.
Forget ranking alongside the world’s iconic tech brands. The challenge right now is to get the basics right. When Gandalf the Grey could not complete his task on Middle-earth, the novelist JRR Tolkien gave the sorcerer a second chance. In some ways, 2024 may be the 64-year-old Mr Gupta’s year as Gandalf the White. Under his leadership, DBS has got the big calls mostly right. If the bank does not make more headlines for its service snags than its return on equity – three percentage points higher in 2023 than in the previous year – investors will be forgiving. It is time to sweat the small stuff. BLOOMBERG
- Andy Mukherjee is a Bloomberg Opinion columnist who previously worked for Reuters, the Straits Times and Bloomberg News.
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