DBS, OCBC shares climb to fresh highs on strong Q2 earnings; yen rally stalls: Markets this week

In this column, ST’s business correspondents unpack the latest developments in Singapore and global markets during the week – and explain what they mean for investors.

DBS and OCBC raised their 2026 financial targets, while UOB kept its guidance largely unchanged.

SINGAPORE – DBS and OCBC shares surged to record highs this week after the Singapore banks posted strong second-quarter results fuelled by their booming wealth management businesses, while UOB’s stock struggled to keep pace.

OCBC shares crossed the $30 mark for the first time and closed 3.94 per cent higher at $30.30 on Aug 7. DBS Bank closed 3.07 per cent higher at a fresh peak of $76.33. UOB, however, ended down 0.23 per cent at $43.30.

DBS will pay shareholders 81 cents a share, comprising a 66-cent ordinary dividend and a 15-cent capital return dividend, after net profit rose 9 per cent to $3.08 billion in the quarter on record wealth-management income.

OCBC will pay a 47-cent dividend after its second-quarter profit jumped 22 per cent to $2.22 billion, while UOB will return 88 cents a share to shareholders as profit rose 10 per cent to $1.48 billion.

Macquarie Capital head of ASEAN equity research Jayden Vantarakis noted that the bank’s 8-basis-point quarter-on-quarter net interest margin decline was the largest among the three banks.

UOB’s new non-performing assets, or loans that turned problematic, hit $902 million in the second quarter, up 90 per cent year on year due to one real-estate account in Greater China. UOB noted that adequate provisions have been pre-emptively set aside to buffer against this exposure.

DBS and OCBC raised their 2026 financial targets, while UOB kept its guidance largely unchanged, except that it now expects low single-digit fee income growth, down from its previous forecast of high single-digit fee income growth.

The Japanese yen struggled to hold on to its recent sharp gains from a joint US-Japan currency intervention.

The yen was around 157.80 per US dollar on Aug 7 after strengthening to 155.20 per US dollar on Aug 3, but remains stronger than a multi-decade low of about 164.

The yen weakened against the Singapore dollar over the week, with one Singapore dollar buying about 123.44 yen on Aug 7.