DBS expects loans to grow 7% in 2018

Higher interest rates are seen to kick net interest margin up.

DBS expects loan growth to hit 7-8% and net interest margin (NIM) uplift from higher interest rates in 2018.

According to UOB Kay Hian, the bank's income is expected to increase at a low double-digit level. The broker expects net profit to grow 23.5% in 2018, significantly higher than the 3.1% growth in 2017.

The cost-to-income ratio is expected to be stable at 43% due to the consolidation of ANZ's Taiwan and Indonesia operations, which have higher cost-to-income ratios. The bank aims to improve cost-to-income ratio by 0.5ppt annually in 2019 and 2020.

DBS also plans to embark on a re-architecture of its data infrastructure. Specific provisions are expected to be at the lower end of its cycle average.  

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