Title Sound Strategy Backed by Strong Capitalization November 5, 2001 THESE PRESS MATERIALS ARE NOT AN OFFER OF SECURITIES FOR SALE IN THE UNITED STATES, SECURITIES MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES ABSENT REGISTRATION OR AN EXEMPTION FROM REGISTRATION, AND ANY PUBLIC OFFERING OF SECURITIES TO BE MADE IN THE UNITED STATES WILL BE MADE BY MEANS OF A PROSPECTUS THAT MAY BE OBTAINED FROM THE ISSUER AND THAT WILL CONTAIN DETAILED INFORMATION ABOUT THE COMPANY AND MANAGEMENT, AS WELL AS FINANCIAL STATEMENTS. "UNITED STATES" MEANS THE UNITED STATES OF AMERICA, ITS TERRITORIES AND POSSESSIONS, ANY STATE OF THE UNITED STATES, AND THE DISTRICT OF COLUMBIA. DBS Group Holdings

2 q Top-line growth offset by conservative provisioning q Strong asset quality and provision coverage q Stabilized interest margin and interest income q Improved efficiency in expense management q Non-interest income continues to shine Ensuring strong capitalization and asset quality coverage

3 Net interest income Fees and commissions Dividend & rental Other income Operating income7231, Staff costs Operating expenses Total expenses Operating profit Loan loss provisions26246NM8NM Cash net profit Goodwill064NM0NM Net profit Financial Indicators (%) Net interest margin Cost-to-income ratio Operating profit up 49.9% QoQ (S$ million) DBS 3Q00 DBS 3Q01 % Change DBS 2Q01 % Change

4 Dao Heng disproportionately contributed to top line growth (S$ million) DBS 3Q01 DHB 3Q01 DBS excl DHB DBS 2Q01 % Change Net interest income Fees and commissions Dividend & rental Other income Operating income1, Staff costs Operating expenses Total expenses Operating profit Loan loss provisions NM Cash profits Goodwill640640NM Net profit

5 Original Estimate: HK$540 million Revenue : HK$275 million Cost: HK$265 million New: HK$750 million Revenue : HK$450 million Cost: HK$300 million Dao Heng synergy targets raised 39%

6 q Top-line growth offset by conservative provisioning q Strong asset quality and provision coverage q Stabilized interest margin and interest income q Non-interest income continues to shine q Improved efficiency in expense management Ensuring strong capitalization and asset quality coverage

7 Prudent provisioning DBS Bank -Loans -Equities -Others Dao Heng Bank DBS Kwong On Bank DBS Thai Danu Bank (DTDB) DBS China Square Others Specific provisions General provisions Total DBSH Group provisions (S$ million) 9M009M01 % Change (44) (58) ,653.1 NM NM (34.4) (26.7)

8 A significant portion of 3Q provision is driven by September 11 attacks Total 3Q provision exercise -Loan related provision -Mark-to-market provision for marketable securities (S$ million) Out of the S$100 million mark-to-market provision expense, S$48 million was written-back after market recovery in October

9 6.0% NPLs fell to 6.0% Dao Heng Bank DBS Thai Danu Bank 5 Regional Countries Others Singapore NBk NPL/NBk Loans (%) (S$ million) 1,112 3,907 7,085 8,1218,149 7,666 4,411 4,834 4,577 Dec 97 Jun 98 Dec 98 Jun 99 Dec 99 Jun 00 Dec 00 Jun 01 Sep 01

10 71% of NPLs are graded “Substandard” 1, , , , ,577 Substandard Doubtful Loss 81% 71% 82% 1% 17% 71%10%19% Of which 9% have never been delinquent or defaulted

11 General Provisions (GP) Specific Provisions (SP) SP+GP/NPLs (SEC) (%) SP+GP/Unsec NPLs (%) SP+GP/NPLS (%) 980 1,894 3,147 3,852 4,286 3,978 2,286 (S$ million) 2,643 2,687 Provision coverage improved from 55% to 59% Dec 97 Jun 98 Dec 98 Jun 99 Dec 99 Jun 00 Dec 00 Jun 01 Sep % 62.9% 58.7%

% 67.3% 16.3% 38.5% 5.6% 3.8% 16.9% 59.1% 22.1% 37.7% 6.3% 5.4% Singapore Restructured / non-accrual Regional countries Restructured / non-accrual Other countries Restructured / non-accrual Total Restructured / non accrual NPLs under SEC reporting Non-restructured NPLs / total loans 41% of NPLs restructured Sep 00Jun % 66.0% 18.2% 41.2% 5.5% 3.4% Sep 01

13 q Top-line growth offset by conservative provisioning q Strong asset quality and provision coverage q Stabilized interest margin and interest income q Improved efficiency in expense management q Non-interest income continues to shine Ensuring strong capitalization and asset quality coverage

14 Margins stabilized at 1.78% in 3Q01 (S$ million) Net interest income Net interest margin (gross basis) 2.00% 2.04% 989 1, % 1.97% 993 1H99 2H99 1H00 2H00 1H % 1,176* 3Q % * Semi-annualised earnings derived from quarterly performance.

15 q Top-line growth offset by conservative provisioning q Strong asset quality and provision coverage q Stabilized interest margin and interest income q Improved efficiency in expense management q Non-interest income continues to shine Ensuring strong capitalization and asset quality coverage

16 9M009M01 % Change On track with target growth rate of YoY 17% expense growth DBSH Group (excluding DHG) Staff costs Occupancy expenses Technology-related expenses Professional and consultancy fees Others Non Dao Heng restructuring costs Total (excluding Dao Heng) Dao Heng Total Cost-to-income ratio (%) (S$ million) , , , (18.6) NM 19.1 NM 30.5

17 Set to achieve 17% expense growth target by end * Q20012Q20013Q H20013Q2001 FY2001 Target 470 (S$ million) (%) Cost containment program is producing results - Operating expenses (excluding Dao Heng) have been declining steadily quarter-on-quarter Year-on-year expense growth expected to meet management target * Includes S$11mn restructuring charge

18 % of txns processed ‘Straight Through u Implementation of CRM & Interactive Voice Recognition will bring Contact Centre STP rates close to Global bench marks u IDEAL & BBS-2000 Enhancements, will drive the Remittance Operations STP rates up to approximately 45-50% u Cheque Truncation Scheme implementation in 2Q-02 along with other initiatives will move the Clearing Operations STP rates closer to the 100% Mark STP rates leap from 14% to 89% Benchmark: Operations Council Remittance Operations % Transactions processed Straight Through Bench MarkDec 00Mar 01Sep 01 Clearing Operations Bench MarkDec 00Mar 01Sep 01 Benchmark: Operations Council Assumes full service IVR capability Contact Centre % Calls handled by IVR Bench MarkDec 00Mar 01Sep 01 % Transactions processed Straight Through Bench mark: Int. research Increasing straight-through levels improve productivity

19 Clearing Operations - Inward Cheques Remittance Operations-Outward TTs Trade Operations - Collections Remittance Operations - Cashiers Orders BudgetYTD (Avg) Budget (Avg) YTD (Avg) Budget (Avg) YTD (Avg) Budget (Avg) (Index) Unit costs are low

20 q Clearing operations:5.25 Sigma q Account services:5.00 Sigma q Remittance operations:4.25 Sigma q Clearing & Remittance Operations ISO Certified Large Productivity Gains from Centralisation & Re-engineering Remittance Operations Transactions / FTE (Index) Clearing Operations Contact Centre Transactions / FTE (Index) Process Quality Transaction / FTE (Index) Processing & Servicing rolled-up Dec 00Mar 01Sep 01 Dec 00Mar 01Sep 01 Transactions / FTE (Index) Dec 00Mar 01Sep 01 Processing productivity is improving

21 q Top-line growth offset by conservative provisioning q Strong asset quality and provision coverage q Stabilized interest margin and interest income q Improved efficiency in expense management q Non-interest income continues to shine Ensuring strong capitalisation and asset quality coverage

22 Loan-related Deposit-related Trade-related Investment Banking Credit Card Fund Management Stockbroking Others Total Fee-to-income ratio (%) Strong fee income despite stockbroking liberalization and weak markets (S$ million) 9M009M01 % Change (29.7) (3.9) (52.3)

23 Other income: FX & securities trading doubled Net gains on treasury activities -foreign exchange -trading securities and derivatives Net gains on sale of government securities and equities Net gains on disposal of investment securities Net gains on disposal of fixed assets Others Total Non-interest income to operating income ratio (%) (S$ million) 9M009M01 % Change

24 Singapore T&M DEaR q Singapore Treasury and Markets have expanded earnings while maintaining DEaR levels Hong Kong DEaR q Hong Kong has benefited from a significant decline in DEaR Significant growth in Treasury & Markets business with consistent risk profile

25 q Top-line growth offset by conservative provisioning q Strong asset quality and provision coverage q Stabilized interest margin and interest income q Improved efficiency in expense management q Non-interest income continues to shine Ensuring strong capitalization and asset quality coverage

Title Sound Strategy Backed by Strong Capitalization Presentation to Media and Analysts November 5, 2001 THESE MATERIALS ARE NOT AN OFFER OF SECURITIES FOR SALE IN THE UNITED STATES, SECURITIES MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES ABSENT REGISTRATION OR AN EXEMPTION FROM REGISTRATION, AND ANY PUBLIC OFFERING OF SECURITIES TO BE MADE IN THE UNITED STATES WILL BE MADE BY MEANS OF A PROSPECTUS THAT MAY BE OBTAINED FROM THE ISSUER AND THAT WILL CONTAIN DETAILED INFORMATION ABOUT THE COMPANY AND MANAGEMENT, AS WELL AS FINANCIAL STATEMENTS. "UNITED STATES" MEANS THE UNITED STATES OF AMERICA, ITS TERRITORIES AND POSSESSIONS, ANY STATE OF THE UNITED STATES, AND THE DISTRICT OF COLUMBIA. DBS Group Holdings