3 Singapore blue-chip stocks that raised their dividends

What happened?

When it comes to investing, beginner investors feel more secure if they can find reputable, strong businesses with long track records.

Blue-chip companies have characteristics that fit this bill.

This category of stocks derives its name because of their large size and ability to weather different economic conditions.

The great news is that most blue-chip stocks also pay out a dividend, thereby providing the investor with a steady stream of passive income.

Earlier, we shared the best-performing Singapore blue-chip stocks in the first half of 2024. 

We also looked at the blue-chip stocks that reported higher profits. 

Since then, I have received questions about which are the Singapore blue-chip companies that raised their dividends when they released their recent earnings report.

Let us explore three stocks that paid out higher dividends to shareholders. 

Three blue-chip stocks that raised their dividends

#1 – DBS Group

Singapore’s largest bank should be no stranger to investors.

DBS is a beneficiary of the sharp rise in interest rates over the past two years, and its strong performance is reflected in its recent earnings report.

For the first half of 2024 (1H 2024), the lender’s total income rose 11% year on year to S$11 billion.

Expenses rose by the same quantum year on year, resulting in operating profit also rising by 11% year on year to S$6.8 billion.

Net profit came in at S$5.7 billion, up 10% year on year, and was a new record for DBS Group.

The group declared an interim quarterly dividend of S$0.54, 22.7% higher than the S$0.44 paid out a year ago.

DBS’s net interest margin (NIM) held up well and stayed constant at 2.14% for 1H 2024.

The bank’s loan book grew by 2.2% year on year to S$424.8 billion which helped to increase its net interest income for 1H 2024 by 6% year on year to S$7.4 billion.

CEO Piyush Gupta recently reiterated that the lender has built resilience against the risks of an economic slowdown along with a potential decline in interest rates.

He believes net interest income should still grow by a mid-single-digit percentage year on year and has reduced this metric’s sensitivity to just S$4 million for every 0.01 percentage point reduction in the US Federal funds rate.

This is down significantly from the S$18 million to S$20 million range back in 2021.

Net profit for 2024 is projected to grow by a mid-to-high single-digit percentage year on year.

Read also: 

• DBS share price rebounds after 2Q earnings. Here's why - Our Quick Take
• DBS, UOB and OCBC raise dividends in 1H24. Which is a better buy?

Related links:

• DBS share price and share price target
• DBS dividend history and dividend forecast

#2 – OCBC

OCBC is Singapore’s second-largest bank and like DBS, also provides a comprehensive range of banking, investment, and insurance services.

The lender also reported a robust financial performance buoyed by higher interest rates and better fee income.

For 1H 2024, OCBC’s net interest income rose 3% year on year to S$4.9 billion while its non-interest income climbed 15% year on year to S$2.4 billion.

The better performance for non-interest income came from year-on-year increases in both trading income and income from life and general insurance.

As a result, total income improved by 7% year on year to S$7.3 billion.

The bank reported that its net profit for 1H 2024 rose 9% year on year to S$3.9 billion.

An interim dividend of S$0.44 was declared, 10% higher than the S$0.40 paid out a year ago.

The bank saw its net interest margin dip by 0.05 percentage points from 2.28% in 1H 2023 to 2.23% in 1H 2024.

However, average assets increased by 5% year on year for OCBC, thus helping the group to register a year-on-year increase in its net interest income.

CEO Helen Wong believes that OCBC is on track to meet its 2024 targets and expects the net interest margin to come in between 2.2% to 2.25% for the year.

She also expects the bank’s loan book to see a low single-digit year-on-year growth.

Read also: 

• OCBC reports higher profit and dividends - Our Quick Take
• DBS, UOB and OCBC raise dividends in 1H24. Which is a better buy?

Related links: 

• OCBC share price and share price target
• OCBC dividend history and dividend forecast

#3 – Singapore Exchange

Singapore Exchange, or SGX, is Singapore’s sole stock exchange operator and operates a platform for the buying and selling of a wide variety of securities such as equities, bonds, and derivatives.

The bourse operator recently released its fiscal 2024 (FY2024) earnings for the year ending 30 June 2024.

Revenue inched up 3.1% year on year to S$1.2 billion while net profit rose 4.7% year on year to S$597.9 million.

If SGX excluded exceptional and one-off items, net profit would have risen by 4.5% year on year to S$525.9 million.

Free cash flow for FY2024 soared 40.5% year on year to S$551.2 million.

The bourse operator upped its quarterly dividend from S$0.085 to S$0.09, taking the annualised dividend per share to S$0.36 from S$0.34.

SGX saw its exchange-traded currencies and commodities volume jump 42.1% year on year to 111.2 million contracts but this was partially offset by a 7.7% year-on-year decline in equity derivative volume to 159.3 million.

One bright spot is the group’s foreign exchange (FX) division which saw average daily volume (ADV) double over the past three years.

SGX, being the predominant venue for the trading of international RMB and INR futures, saw open interest grow 76% to US$27.6 billion.

Management intends to rely on its ferrous and freight offerings to drive SGX’s next phase of growth while scaling up its FX franchise by acquiring clients across Asia and Europe.

Related links: 

• SGX share price and share price target
• SGX dividend history and dividend forecast

What would Beansprout do?

Blue-chip stocks can form the bedrock of new investors’ portfolios. Their resilience may provide you with additional assurance on their ability to ride through economic cycles.

Across the Singapore blue chip companies, DBS, OCBC and SGX have reported an increase in dividends in their latest results, offering shareholders a stream of dividend income. 

Across these names, OCBC offers the highest dividend yield of 5.9%, while DBS also offers a fairly high dividend yield of 5.8%. SGX offers a lower dividend yield of 3.3%. 

In fact, DBS’ dividend yield remains close to one standard deviation above its historical average of 5.0%. 

Likewise, OCBC’s dividend yield is also more than one standard deviation above its historical average. 

However, SGX’s dividend yield is close to one standard deviation below its historical average. 

For investors starting to look at these blue chip names for dividend yields, it might be hence be worthwhile starting your research on DBS and OCBC.

You can also check out our DBS price target estimator to calculate the estimated yield you would receive based on your target entry price or exit price of DBS.

Related links:

• DBS dividend history and dividend forecasts  
• OCBC dividend history and dividend forecasts
• SGX dividend history and dividend forecasts

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