Understanding NIM Compression: Is the DBS Dividend Still Sustainable? | 🦖 EP1442 #investingiguana
Understanding NIM Compression: Is the DBS Dividend Still Sustainable? | 🦖 EP1442 #investingiguana
The STI crossing the 5,000-point mark has created a level of retail euphoria I haven't seen in a long time, and DBS is right at the center of it. I spent my evening yesterday digging through the Q4 net profit miss and comparing it to the dividend hike, and the disconnect between the bank's brand dominance and its actual core margin contraction is becoming impossible to ignore.
Everyone is focused on that 37.8% dividend jump, but the forensic reality is that the "biggest and safest" bank name is currently priced as if interest rate headwinds don't exist. We are looking at a 49.4% premium over the historical price-to-book ratio at the exact moment net interest margins are beginning to squeeze. It feels like the market is confusing size with safety, and that is usually when retail investors get caught off guard.
This is a critical moment for the 1,440 Elite members in our community who hold DBS as a cornerstone of their long-term portfolios. If you are treating this bank as a "set and forget" proxy for a fixed deposit, you need to audit the entry price you are paying for that yield. Whether you are managing an SRS account or a CPF portfolio from your study in Ang Mo Kio, the entry price—not the payout—is now your primary risk.
I’m not betting against the dividend, but I am betting against overpaying for it. I’ve put together a forensic look at why $48 is the level where the margin of safety actually returns. I hope this helps you make a grounded decision before the noise of the new week begins.
📺 YouTube: https://youtu.be/AmTJoP6MjIY
📩 Substack: https://open.substack.com/pub/investingiguana/p/the-investing-iguana-dbs-group-holdings?r=5enmf1&utm_campaign=post&utm_medium=web&showWelcomeOnShare=true
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