Dah Sing Financial Holdings (440) H2 2024 earnings summary

Executive summary

• Profit attributable to shareholders rose 5% year-over-year to HK$1,673 million, driven by higher net interest and non-interest income, despite increased credit impairment charges.

• Net interest margin expanded by 16 basis points to 2.17%, with net interest income up 9% year-over-year, supported by higher interest rates and effective funding cost management.

• Non-interest income, including fee, commission, and trading income, saw significant growth, with net fee and commission income up 54% and net trading income up about 40%.

• Operating profit before impairment losses increased 26% year-over-year, reflecting a 39% rise in non-interest income and stable operating costs.

• Final dividend of HK$1.18 per share declared, bringing total dividends for the year to HK$668.8 million, a 5% increase from the prior year.

Financial highlights

• Total operating income grew 15.5% year-over-year to HK$7,211 million.

• Net interest income reached HK$5,401 million, up 9.1% from the previous year.

• Net fee and commission income rose to HK$1,311 million, a 31% increase year-over-year.

• Insurance revenue increased 18% to HK$1,105 million, with insurance service result after finance expense at HK$100 million.

• Credit impairment losses surged 145% to HK$1,790 million, mainly due to increased provisions for Mainland China property developers and Hong Kong commercial real estate.

• Profit for the year was HK$2,201 million, up 6.4% year-over-year.

• Basic earnings per share were HK$5.25, compared to HK$4.99 in 2023.

Outlook and guidance

• Ongoing challenges expected in the near term, including elevated credit risks and sluggish loan growth.

• Diversified revenue base and robust capital and liquidity positions position the group to respond proactively to market changes.

• Continued focus on prudent credit risk management and support for SME community in Hong Kong.