DBS (Development Bank of Singapore)

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Rainbow 
DBS - We would like to clarify that DBS' plans for a digital exchange are still work in process, and have not received regulatory approvals. Until such time as approvals are in place, no further announcements will be made.
https://links.sgx.com/1.0.0/corporate-an...b9aa6a1952

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Rainbow 
[Image: f3fa8d96-a169-99b7-7ac0-9e7d4de2cb6d?t=1...ePreview=1]
Piyush Gupta, Group CEO, DBS, said, “The exponential pace of asset digitalisation provides immense opportunities to reshape capital markets. For Singapore to become even more competitive as a global financial hub, we have to prepare ourselves to welcome the mainstream adoption of digital assets and currency trading. DBS is committed to accelerating the development of a fully integrated ecosystem to facilitate this. We believe that this is the first of its kind integrated offering, which is differentiated in many ways.” 

Setting the DBS Digital Exchange apart 
The DBS Digital Exchange is a members-only exchange for Institutional Investors and Accredited Investors.
https://links.sgx.com/FileOpen/DBS%20Dig...eID=641963

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Rainbow 
DBS $36.45

[Image: Singapores-Largest-Bank-to-Launch-a-Cryp...24x576.png]
https://finance.yahoo.com/news/largest-b...37257.html

DBS Bank CEO Piyush Gupta during the bank's fourth-quarter earnings call Monday said there is a roadmap in place though declined to give further specifics.

"We've started doing the work on seeing how we get in a sensible way, take it out, and expand it beyond the current investor base. And that includes making sure we appropriate thinking about things like potential fraud and others," Gupta said during the call. "We should have something by the end of the year."


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Normally, bonus issues on the local bourse are for the smaller caps to increase "outstanding share count and eventually shareholder base". So, it is quite rare for a component bank in the STI Index to do a bonus issue.

DBS says that the bonus issue will "increase the pace of capital returns to shareholders". But a bonus issue will actually increase the share capital, at the expense of retained earnings. Cash dividends are mainly paid out of retained earnings. To accelerate capital returns to shareholders, isn't the mathematically correct way be (1) share buyback to reduce share capital, (2) increase dividends to deplete the retained earnings?

DBS Q4 profit falls 3% to S$2.27 billion; proposes S$0.54 per share dividend, 1-for-10 bonus issue

In addition, DBS proposed a bonus issue on the basis of one bonus share for every existing 10 ordinary shares held.

“The bonus shares will qualify for dividends starting with the first-quarter 2024 interim dividend and will increase the pace of capital returns to shareholders,” said the lender. It added that the annualised ordinary dividend going forward will be S$2.16 per share over the enlarged share base, 24 per cent higher than the S$1.92 per share for FY2023.

https://www.businesstimes.com.sg/compani...onus-issue
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I suppose the idea is to enlarge the base, in this case by 10%, so that subsequent effort will be accelerated by 10%. Doing a one-off large special dividend will do but I suspect the result of a one-off bump in the share price may not be quite as desirable for DBS?
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(08-02-2024, 09:13 AM)egghead Wrote: I suppose the idea is to enlarge the base, in this case by 10%, so that subsequent effort will be accelerated by 10%.  Doing a one-off large special dividend will do but I suspect the result of a one-off bump in the share price may not be quite as desirable for DBS?

An alternate to enlarge base so that subsequent effort will be accelerated by 10%, the BOD could  bump up the dividend by 10% to achieve the same effect. I believe DBS is 1 of those that does a quarterly "fixed" dividend.

Of course, both moves -  either enlarge base OR bump up fixed dividend - achieve similar capital returns to shareholders. The only difference I see is the different accounting on the share capital/reserves as I mentioned earlier. That is why is puzzling me.

I reckon I am probably overthinking on this! Regardless on the matter of capital returns, DBS is making the right moves to return them.
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(09-02-2024, 08:51 AM)weijian Wrote: An alternate to enlarge base so that subsequent effort will be accelerated by 10%, the BOD could  bump up the dividend by 10% to achieve the same effect. I believe DBS is 1 of those that does a quarterly "fixed" dividend.

Hi weijian,

Actually, DBS is doing both. Enlarge base with bonus issue and bump up fixed dividend with higher quarterly dividend of 54 cents, up from 42 cents a year ago and 48 cents a quarter ago. And also with a 1 for 10 bonus share issue which will also be entitled to 1Q’24 quarterly dividend payment of 54 cents/share.
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hi ghchua,

Thanks for the clarification as I haven't really dwelled into DBS's dividend history.

In this case, why wouldn't DBS decide on a "60cents/share" dividend (with no 1-for-10 bonus), compared to the current action of 54cents/share on 1-for-10 bonus for 1Q24?
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