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DBS, OCBC & UOB Dividends_ A Good Investment_

DBS, OCBC & UOB Dividends: A Good Investment?

profileJustin Oh

For the uninitiated, DBS Group Holdings Ltd (SGX: D05), Oversea-Chinese Banking Corporation Limited (SGX: O39), and United Overseas Bank Ltd (SGX: U11) are three major listed banks in Singapore. 

And they make up around 46% of Singapore’s stock market benchmark, the Straits Times Index (STI)

The trio of banks is popular among dividend investors here due to their growing dividends over the years. 

In this article, let’s check out DBS, OCBC, and UOB from the perspective of their dividends. 

Source: Giphy

TL;DR: DBS, OCBC & UOB Dividends

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Earnings Growth

Firstly, let’s explore how the banks have grown their earnings over the last five years. 

If a company can consistently grow its earnings, it means that it has a strong business. 

It would also mean that it has the possibility of paying out higher dividends as its business grows over time. 

The following table shows how DBS, OCBC, and UOB have grown their earnings per share from 2019 to 2023 (the banks have a 31 December year-end): 

Earnings Per Share
(Year/Bank)
DBSOCBCUOB
2019S$2.46S$1.14 S$2.55
2020S$1.81S$0.80S$1.69
2021S$2.61S$1.07S$2.39
2022S$3.15S$1.27S$2.69
2023S$3.87S$1.55S$3.34

We can see from the table that all three banks have seen strong growth in historical earnings, except for the fall in 2020 due to the pandemic.

With the banks’ increase in profits from 2019 to 2023, their dividends have climbed as well. 

Dividend Growth

The next table reveals the dividend history of DBS, OCBC, and UOB. 

Dividend Per Share
(Year/Bank)
DBSOCBCUOB
2019S$1.23S$0.53S$1.30
(includes special dividend of S$0.20; S$1.10 without)
2020S$0.87S$0.318S$0.78
2021S$1.20S$0.53S$1.20
2022S$2.00
(includes special dividend of S$0.50; S$1.50 without)
S$0.68S$1.35
2023S$1.92S$0.82S$1.70
Compound annual growth rate
(CAGR)
9.31%7.17%5.51%

DBS has increased its dividends the most from 2019 to 2023 to the tune of around 9.31% per annum. 

For 2020, all three banks had to curb their dividends as a pre-emptive measure by the Monetary Authority of Singapore (MAS). 

However, MAS lifted the dividend restriction in July 2021 and all three banks have reinstated their dividends since then. 

Here’s a look at the banks’ dividend history:

YearDividend PeriodDBS Dividend Per Share (Singapore Cents)Total Dividend for the Year (Excluding Special Dividend)OCBC Dividend Per Share (Singapore Cents)Total Dividend for the Year (Excluding Special Dividend)UOB Dividend Per Share (Singapore Cents)Total Dividend for the Year (Excluding Special Dividend)
20191Q interim dividend30123-53-130
2Q/1H interim dividend302555
3Q interim dividend30--
Special dividend--20
Final dividend332855
20201Q interim dividend3387-31.8-78
2Q/1H interim dividend1815.939
3Q interim dividend18--
Final dividend1815.939
20211Q interim dividend18120-53-120
2Q/1H interim dividend332560
3Q interim dividend33--
Final dividend362860
20221Q interim dividend36200-68-135
2Q/1H interim dividend362860
3Q interim dividend36--
Special dividend50--
Final dividend424075
20231Q interim dividend42192-82-170
2Q/1H interim dividend484085
3Q interim dividend48--
4Q final dividend544285

Frequency of Dividend Payments

DBS’ dividend is currently broken down into four different payouts. Since the first quarter of 2019, it has been declaring dividends every three months. 

DBS said in its 2019 first-quarter earnings that it would start paying quarterly dividends to provide “shareholders with more regular income streams”, instead of biannually as was the case previously.

DBS’ peers, OCBC and UOB, still pay dividends half-yearly.

Dividend Payout Ratio

The dividend payout ratio tells investors what percentage of a company’s earnings are paid out yearly as a dividend.

Any ratio below 100% means that the company is paying dividends sustainably.

Let’s see how sustainable dividends from DBS, OCBC, and UOB are by examining their dividend payout ratios: 

Dividend Payout Ratio
(Year/Bank)
DBSOCBCUOB
201950.0%46.5%43.1% (51.0% if special dividend is factored in)
202048.1%39.8%46.2%
202146.0%49.5%50.2%
202247.6% (63.4% if special dividend is factored in)53.5%50.4%
202350.9%52.9%50.9%

As seen from the table above, including special dividends, all three banks have been paying out less than 100% of their earnings as dividends.

Dividend Guidance

DBS is the only local bank that has guided its dividend.

It has a dividend policy of paying “sustainable dividends that grow progressively with earnings”. But it doesn’t have a specific dividend payout ratio, unlike some other listed companies.

Latest Dividend Yield

Of the three banks, DBS has the highest dividend yield at the time of writing, followed by OCBC and UOB.

 DBSOCBCUOB
Share price S$33.58S$13.11S$28.29
Dividend Yield for FY2023S$1.92S$0.82S$1.70
Dividend yield (forward)6.43%6.38%6.01%

Read More:


Going Deeper into the Banks’ Dividends

If you wish to find out even more about the banks’ dividends, do check out our separate dividend guides for DBS, OCBC, and UOB!

For DBS 👇

For OCBC 👇

For UOB 👇

Disclaimer: The information provided by Seedly serves as an educational piece and is not intended to be personalised investment advice. ​Readers should always do their own due diligence and consider their financial goals before investing in any stock. The writer doesn’t own shares in any companies mentioned. 

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About Justin Oh
Your average Zillennial who is obsessed with anime, games, movies and of course, personal finance. Join me as I break down personal finance into easily digestible and fun bits!
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