DBS, OCBC Shares Clock New Intraday Highs on Capital-Return Prospects

By Amanda Lee and Megan Cheah

Shares of two major Singapore lenders extended their winning streaks to clock new intraday highs, spurred by strong investor confidence in their wealth-management and capital-return prospects.

DBS Group's shares rose as high as 1.3% to 56.00 Singapore dollars, equivalent to US$43.43, while OCBC climbed as high as 0.8% to S$19.45 early Tuesday. DBS and OCBC have since pared gains and were both last up 0.6%.

The banks' stocks have been finding new peaks after robust third-quarter earnings.

Wealth-management fees have largely offset compressed net-interest margins stemming from lower interest rates. The lenders--the two largest by assets in Southeast Asia--have also sweetened the deal for their investors by doling out high dividend payouts, with promises of more to come.

Analysts reckon that the banks' shares will continue to perform well into the new year, even as global interest rates are projected to fall.

OCBC and DBS shares should be able to withstand any jitters from lower profit, as their capital-return plans such as buybacks and dividends could support share prices, said CGS International analyst Tay Wee Kuang.

Singapore banks are still regarded as high quality investments, drawing investors through their implied yields of 5%-6% in 2026, Tay said in an email.

Markets are also likely betting that margin contraction is bottoming and low rates should spur stronger loan growth and wealth fees next year, said Maybank Securities' head of research Thilan Wickramasinghe in an email.

Wickramasinghe also reckons that Singapore's central bank-led equities market review could benefit the banks, as the potential for more capital markets deals could grow fee income further.

Between the pair, OCBC's shares may be more palatable to some investors, as its valuations are at a discount, said RHB Research analysts in an email.

Still, DBS's dividend yields remain attractive and the bank offers strong payout visibility given its management's commitment towards capital returns, they added.

"We think this has been a factor driving its share price performance while [concerns about] its premium valuations have taken a back seat," RHB said.

Write to Amanda Lee at amanda.lee@wsj.com and Megan Cheah at megan.cheah@wsj.com

(END) Dow Jones Newswires

December 16, 2025 01:36 ET (06:36 GMT)