DBS jumps 3.5% after O&G cleanup; bank stocks drive STI to nearly 2½-year high;

DBS reported on Nov 6 a 25-per cent fall in third quarter earnings S$802 million from a year ago, as the bank almost doubled its specific provisions for oil and gas bad debts.
DBS reported on Nov 6 a 25-per cent fall in third quarter earnings S$802 million from a year ago, as the bank almost doubled its specific provisions for oil and gas bad debts. PHOTO: REUTERS

SINGAPORE - Shares of DBS Group Holdings jumped over 3.5 per cent on Tuesday (Nov 7) following the cleanup of its oil & gas support services exposure.

At 1.20 pm, DBS was up 3.5 per cent or 80 cents to S$23.59. It had earlier touched a high of S$23.69.

Year-to-date, Southeast Asia's biggest bank has gained 36 per cent.

DBS on Monday reported a 25-per cent fall in third quarter earnings S$802 million from a year ago, as the bank almost doubled its specific provisions for oil and gas bad debts. The step removes uncertainty over asset quality, enabling investors to refocus on operating performance and the bank's digitalisation agenda, DBS said.

Its smaller rivals, United Overseas Bank and OCBC Bank, also rose on Tuesday as investors looked ahead to the lenders' higher earnings on the back of faster economic growth in the region.

UOB was up 1.6 per cent to S$25.15 and OCBC was 1 per cent higher to S$11.84. UOB and OCBC have risen 23 per cent and 33 per cent respectively since the beginning of 2017.

The banks stocks drove the Straits Times Index to its highest in nearly 2½ years.

The STI rose as much as 0.94 per cent to 3,413.62 at around 12:30pm, its highest since May 2015. It was trading at 3,413.29, up 0.93 per cent as of 1:55pm.