The lender's results demonstrate how higher central bank interest rates have expanded interest margins around the world.

DBS yesterday reported first-quarter net profit of S$2.57 billion ($192.5 billion), a rise of 43 per cent on the same period a year before. Compared with the previous quarter, profit rose 10 per cent.

Total income rose 34 per cent year-on-year to S$4.94 billion, buoyed by a rise in its net interest margin of 66 basis points, and on the back of business momentum, the Singapore-headquartered group said. 

The lender’s cost-income ratio narrowed by seven percentage points to 38 per cent.

Consumer loans fell 1 per cent or S$1 billion as wealth management loans declined, DBS said in a statement. Deposits and wealth management net new money benefited from flight-to-safety inflows in March. Compared with a year ago, deposits were 4 per cent or S$20 billion higher. Wealth management fees increased 39 per cent to S$365 million, due partly to seasonal effects.

“We delivered a record performance and benefited from safe-haven deposit inflows during a quarter marked by increased market volatility. Our ability to sustain business momentum as well as customers’ trust in a time of market stress are the result of our solid capital position, prudent risk management, diversified business lines and nimble execution, underpinned by an ongoing digital transformation,” DBS CEO Piyush Gupta said. 

The bank said costs of S$1.88 billion were 4 per cent below the previous quarter, which had included non-recurring items. Expenses were stable on an underlying basis.

The Common Equity Tier-1 ratio, an international measure of a bank’s capital buffer, slipped 0.2 percentage points from the previous quarter to 14.4 per cent.