Earnings Forecast

Singapore's DBS posts 6 pct drop in Q2 profits, bad debt charges more than double

:The DBS Group Holdings Ltd. logo is displayed atop the company's DBS Asia Hub building in Singapore, on Thursday, Feb. 9, 2012.
Munshi Ahmed | Bloomberg | Getty Images

DBS Group Holdings, Singapore's biggest lender, posted a 6 percent drop in second-quarter profit, hit by a sharp jump in provisions for bad loans as firms in the oil and gas services sector struggle to service debt.

DBS's net profit came in at S$1.05 billion ($780 million) in the three months ended June, versus a S$1.12 billion profit a year earlier.

This is line with an average forecast of S$1.051 billion from six analysts polled by Reuters. The poll was taken before DBS disclosed its S$700 million exposure to troubled oilfield services firm Swiber Holdings.

DBS said bad debt charges more than doubled to S$366 million as a result of the net charges of S$150 million for Swiber.

United Overseas Bank and Oversea-Chinese Banking Corp, have also flagged concerns about loans to the oil and gas services sector - a key industry in Singapore.

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