DBS considers prime brokerage business as Q3 profit falls 5% on weaker trading income

Singapore's DBS Bank announced a 5% decline in Q3 net profit due to weaker trading income, falling short of the S$2.95 billion consensus forecast. The bank is considering establishing a prime brokerage business to expand its institutional equities franchise and tap growth opportunities in Asian financial markets. Although DBS does not currently have a traditional prime brokerage business, it has key elements in place, such as stock custody, market access, and trading capabilities.

CEO Tan Su Shan stated, "In Asia, we have all the building blocks, and we may put it together." Prime brokerage services typically cater to hedge funds and other financial entities, providing services like margin financing, securities lending, custody, and trade clearing. DBS remains focused on the financialization of Asian markets and the growth of its foreign institutional investor and financial institutions group franchises.

The net profit for the quarter ended Sep 30, 2026, was S$2.81 billion, down from S$2.95 billion a year earlier. Trading income declined by 65%, falling to S$152 million. While trading accounts for just 6% of total income, Tan emphasized that the bank's structural growth momentum remains strong. DBS expects total income growth in 2027 to be in the mid-single-digit range, driven by a mid-single-digit growth in net interest income and non-interest income.