DBS Group Holdings Ltd ($D05)

Okay. Hi, everyone. Welcome to the first quarter '26 DBS analyst briefing. As usual, you've heard the media briefing, so we've gone through the decks. We can go straight to Q&A.

So first question from Jayden from Macquarie.

Can you hear me okay?

Yes.

Okay. Great. I just had 3 points I wanted to ask on. The first is just to clarify on the general allowances. So I think you made it pretty clear during the media briefing that it's unclear if we could have write-backs now. But we've sort of said that the JP allowance is appropriate for the current sort of situation. Just wanted to know, did you change any of the macro assumptions that go into the MAVs, like the view on growth, inflation, any potential impacts on the economies and where you operate? Obviously, I realize that there's a lot of judgment that goes into that. We'll be interested for your thoughts, if I could start there.

Well, I can take the sort of the way we think about this part and then maybe -- so can go through the MAV and actual numbers. And we've done this quite a few times, right, from COVID to Ukraine to now Iran. We stress test for oil at 120 going all the way up to 200. We stress test for some of the markets that we work in, currencies depreciating by 20%, 30%. And we stress test for demand destruction as well. Or we stress test also for inflation on the cost of goods, be it fuel oil or chemicals or fertilizers, et cetera. So all that stress test goes into all our mornings and then we identify companies that are at risk, and then we put them into the watch list depending on how far -- how bad they look. So that's the rigor and discipline that we do it, do it both top down and bottom up. And as I said, when we did that again for this war for Iran, the numbers were actually pretty okay. We realize we have more than sufficient buffer, ample coverage for the worst-case scenarios that we factored and stress tested. So that's why we don't feel that we need to do any more. You want to...

Yes. So Jayden, I think I would say that we can put in the sort of macroeconomic variables, we can make assumptions. But I think the more important point is the transmission mechanism, which is much harder to get right. On how sort of these oil prices, how the transmission will work, whether there's a lag effect. So I think we do the best with the models that we have, but we want to be prudent. And while our stress testing numbers are coming in lower than the stack of general provisions that we have, we want to be watchful and see how it will pan out in the subsequent quarters before we talk about GP release.

Yes. That's very helpful. I realize that there's a fair amount of uncertainty, but I think the bottom-up process is very helpful.

Yes. And Jayden, we talk to all the big clients, right? So obviously, you talked to airlines, you talk to oil and gas players. You talk to fertiliser players, food and agri players. We talk to everyone and find out, hey, when are you going to run up inventory? Hey, how much are you pricing up? Hey, have you got force majeure on this? Are you allowed to have force majeure on this based on your documentation and all that? Once it's FOB technically the seller -- only the seller can -- the seller sold it, right? The buyer can't do FM on -- once the goods are FOB. But the truth is, it's very nuanced and it's very bottom up, because you might have someone that just declared force majeure. And then, guess what, they jack up their prices so much. Actually, they have record profits, right? Or you might have someone who says, "Oh my God, I can't hedge my -- I'm not spot short forward, but I can't get my spot out of the Strait of Hormuz." So you think, okay, discount that. But then suddenly, they make tons of money in their trading room, right? So it's very single client dependent. You have to talk to everyone. You've got to get input from everyone and you have to stress test for all the very large gaps. And that's what we're doing. Talking to the big clients and getting input on the industry is crucial and that's what we're doing.

That's really helpful. And then speaking of hedging, you've obviously done a good job in the first quarter and obviously maintain the fixed and the hedging portfolio at similar levels. I remember in prior quarters, you said that it'd be about a 50 basis points gap. If you were to roll those off and then move to floating. Any sort of updated thoughts on where that is now and what you've been able to achieve? Because you sound a lot more sort of confident on the net interest income side.

I can kick off and I'll Phil to amplify. So yes, we are a little bit more confident now because the market volatility has given us opportunities to do this better. When I last spoke to you, we said we'll probably have to renew our hedges at 50 bps below. It's now looking like 40 bps below the last price. So we're better now. Phil?

Yes. I mean, Su Shan's basically summarized it quite well. We had a good first quarter. We basically managed to over replace the maturities. So there isn't as much left for the rest of the year. It's about $60 billion for the rest of the year. But we're maintaining the duration of that portfolio at fairly healthy levels.

Okay. That's really helpful. And then maybe just a final question I wanted to ask, the wealth activity looks really strong in terms of the fee momentum in the first quarter. Any sort of views on how it's panned out for April, as client activity remained robust? What are your sort of thoughts what you're seeing now?

So Tse Koon here. On the wealth numbers, it's generally made up of both investments as well as insurance, right? And so in April, as we know, the market has gotten to be a lot more volatile. So therefore, we did see some volatility in the first 2 weeks of April. But then from third week onwards, we started to see again good momentum coming back. So I think over this period, again, it's anybody's call. But suffice to say, we've got a strong foundation of customers. We've got customers that have got dry powder. And therefore, it's 1 of those things as we take a portfolio approach to advise our customers. We do think that we still stand in a good position. The rest is really the market which is anybody's guess. Having said that, we do also have a very robust bank assurance pipeline, and we've seen the momentum very strong in Q1. So we do have a very diversified, I would say, stream of revenue in this space.

Next question from Melissa from Goldman's.

I think you might go back on some of the points you just made just a bit quickly. In terms of the hedging, you mentioned that you have done most of it, but you have $60 billion to go for the year. Wasn't it at the last quarter, you mentioned that only the roll off or the ones that roll off this year was only $80 billion. So -- why -- so have you done all and then you're doing more? Or what's going on there? Also just in terms of just getting around, again, like you mentioned that now your SORA assumption is much lower, but you are expecting more impact. So how have you managed it? Because in terms of the SORA sensitivity, you are now seeing it's $11 million. But before the last quarter, I know it's very small, you were saying only $10 million. So just wanted to understand that a little bit better? That's the first question, and I'll just hop on to the next 1 after you answered that.

Yes, sure, Melissa. So I said we over replaced in the first quarter. I didn't say we've done most of the book. So we over replaced what matured, and we have about $60 billion left to do with the rest of the year. So we'll look for spikes and we look for opportunities to replace that, and as much as...

I think that's the time -- I think it was a misunderstanding because yes, we over replaced -- actually what happens is the book this $80 billion that matures this year, and it's over the fourth course of the year. So for first quarter, we did a little more than...

Sorry, my typing is coming through on the phone.

Sorry, sorry.

Yes, that's right. So I think Su Shan summarized it pretty well there. So that's a piece. On the SORA sensitivity, the sing dollar rate sensitivity, essentially as the CASA comes in, the sensitivity goes up. So it's directly correlated with the deposit growth that we've just talked about, and that's really where the sensitivity comes in minus what we're able to hedge. So that's the net number you see, which has gone up about $1 million per basis point over the quarter.

So it's a double -- I mean, it's funny, right? Because we actually want to have more CASA but that makes us more NIM sensitive, but it helps our NII, which is why we keep saying, look at the NII, don't look at the NIM, because we want to have more CASA. We want to have more low-cost CASA, right? It's good for us.

Right. So we are still of the view...

Yes. So Melissa, to your point, maybe in the -- you're asking why is it that SORA has gone down? And how do we manage it? If you think about it, it's the deposit growth, we said we are changing our guidance for deposit growth. We -- last quarter, we are thinking of mid-single digit. Now we are really talking about high single digit. And with more deposits coming in, and remember, we guided that we can make 1, 1.2 percentage points for all the deposits that come in, that has actually -- the additional deposits that are coming in has actually helped to mitigate the effect of the lower SORA. At that point, we can get to fairly resilient numbers despite the down drift in the rates.

So can I just say in terms of when you say resilient numbers and you missed out the guidance that NII slightly done, are we still NII slightly down or NII flattish now?

NII is still slightly down, but it's a big -- I think it's a big deal to be able to say we are still slightly down despite further rate in -- the rate environment that we have seen. And this because we can mitigate it to the sort of deposit that have come in.

Deposits and hedgings.

Right. Okay. Then just lastly, in terms of dividends, given where your new outlook for REITs and your strong returns. Are we still very confident at the end of this year, we can still do the $0.06 up in terms of the DPS?

Well, it's hard to predict what will happen in the end of this year just because we can't predict the geopolitics. So I think we'll need to have a couple more quarters of clarity before we commit to anything. But this is a board-level discussion and we'll definitely keep you posted.

Next question, Yong Hong from Citi.

Can you hear me?

Yes.

I just have 3 questions, 2 on wealth and 1 on NII. So firstly, on wealth, just wondering how much of the net new money was driven by port banking? And any thoughts on the sustainability of this $10 billion? Some color on the net new money prospect by geography will also be helpful. Yes, this is my first question.

Okay. So the $10 billion, 6 was for. The high net worth and 4 was for treasures. The geography was actually very wide. So no single concentration. I think it should. We should be able to hopefully maintain the momentum. Don't want to overpromise, but what do you think, Tse Koon?

Yes. So as we described earlier on, given that our treasurer's franchise is actually pretty much onshore. And therefore, if it's out of tenors from there. So by nature, it is already very well diversified, right? And then the sixth is PBTPC, which is more a global kind of a business. So it's very, very broad-based. Now as to whether we are able to sustain, I do believe we can, for simple reason that we have talked about it is a macro trend that wealth is continually being generated out here in Asia. We continue to be onboarding new customers. We've got a strong pipeline. And so if anything, I would say these kind of numbers is what we have consistently seen now over the last 4 years, 4, 5 years. So I don't see a reason why this should not continue.

Yong Hong, I think what is pleasing for me is that the 1 bank is working both IPG and wealth connectivity across all the markets is happening. We bank the business, we bank the family. We talk about succession planning. They do the key members, insurance with us, we look after their kids, their grandkids. So it's very sticky and it's also focused on the future, not just this generation, but the next 1 and the next 1. So we're building a sticky franchise. The wealth AUM is going to be lumpy, right, especially at the high end because you get 1 big client, it goes up, then if the guy needs to send money out somewhere to do something, it goes up. So it goes in and goes out, it's quite lumpy. The key is we must keep having a cadence of new to bank and next generation and then set them -- engage them in lock them down with trust, estate planning and banker, and that's exactly what we're doing.

Okay. Yes. My second question is, what is the proportion of AUM in investment products in the first quarter and where are we in the month of April? So I'm just wondering what is keeping you from upgrading your commercial noninterest income guidance for the year?

Okay. So 58% of the AUM is in investment products. Your second question was what?

And how does it compare with the month of April? Because you were saying potentially April, we are seeing a little bit less upbeat in terms of equity market sentiments. So just wondering what has been a trend in April for this ratio?

Are you talking about the wealth side or...

the proportion of the AUM in investment products. Basically just some color on the wealth momentum in April.

So okay. So the wealth momentum in April, basically, wealth management is made up of INI, right? So both insurance and investments. The -- on the investment side, in April, first 2 weeks there was as we can see in the market is pretty public, generally quite muted. But the third week, again, it started to bounce back. So it's kind of pretty volatile during this time. But having said that, within the whole investment arena, we have a broad base of different instruments, right? It's not just about equities but there are also various structures involved in there. At the same time, we have a very broad range of funds, both public and private, which customers continue to gain exposure in. So it's very, very broad-based. On the insurance front, the momentum has been exceptionally strong, and that has continued into April.

Okay. Got it. And so would you say that your wealth -- or your clients in the wealth segments, they are still basically putting their money into use and basically deploying the deposits into investments? So basically, no slowdown in that from what we have been seeing since the first quarter?

Yes. I would say in a broad sense, yes, because the advice that we give to our clients has always been to stay invested. We do not believe in a -- timing the market. So we always tell our clients time in the market is far better than timing the market. And therefore, we take the portfolio approach. And it is in these times that we also would, in some cases, were relevant, help our clients or work with them to rebalance their portfolio. There are opportunities actually in these types for them to build a portfolio.

And I've always said right, Yong Hong, that I think the role of capital as a source of passive or active income is going to rise for young people and for retirees, because the velocity of money in Main Street is going down, but the velocity of money in Wall Street is going up, right? If you want to use an analogy. And therefore, we want to start them young. So Tse Koon is not just building the high net worth, right? We're going down the chain to do digital wealth or digi wealth, our Digi portfolio is doing really well. I mean the AUM has doubled or something like that, right, over the last few months. And we want to promulgate concept of regular savings planned, easy, safe as you earn and easy sort of risk-adjusted portfolio to suit retail wealth life cycle needs for longevity and for retirement and for active income, if you're in the gig economy, right? So don't just focus on that top end level, look at it holistically. Look at well starting from retail wealth all the way up the wealth continuum especially in some of the key markets like Singapore, Taiwan. And then for other fee recurring fee, look also at GTS, look also at loan fees because we're trying to build the snowballing effect of more flow, more sticky transactions, more operating accounts and more fees. So the loan fees is being hard fought. But one, you can see it's consistently strong, because we're winning key mandates now we're the lead for a lot of the syndicated loan structures that we do because of our industry focus. There GTS, we're winning more and more cash operating mandates, right? We're winning because we are a dependable bank with digital, we know how to tokenize deposits, we are safe. So we are also a diversified bank for many of these MNCs that either to only bank with global banks, but now they want to diversify risk, so they come to us. So we're winning operating mandates as well. So what we're trying to build is a nice cadence of recurring fee income across the board. So wealth is one, GTS is one, loan fees is one, payment fees is one. So using AI, using smart models, using customer engagement as I try to build that sort of fee engine.

Okay. Got it. Maybe just 1 final question on NII. I think there was some -- you started a little bit more domestic from deposits. Just wondering, given the April bond new trends does that even give you more opportunity to do more hedging and that potentially also is another driver why you started more optimistic on NII?

I guess, in a word, yes. Phil, do you want to just say anymore?

Yes.

You know what, yes, but I don't want to overpromise and under deliver, right? So you know our -- we're using 1% on SORA, and we're expecting no U.S. rate cuts now. And so we're ready for -- if times are bad and the wars turns out to be even worse than we anticipated than it's drags on and we have sacculation, then we are building a fortress balance sheet just to prepare for the worst. So if it's really bad, we're ready for it, right? So if things all go to port, we're ready for it. We've got enough with us. We fight for deposits. We invest in HQLA. We play safe. We take off risk on SMEs and CCUL. So I think, from a risk and a CASA perspective, we're good. Then if the markets pick up, the war ends early, hey, then we can go forth and conquer more fee. Hopefully, last volatility on the downside and more alpha on the upside.

Let's move on to Aakash from UBS. I think there's quite a few questions in queue, so we could limit you to 2 questions.

Congrats on a pretty solid quarter. If I can just start off the first question with understanding the net interest margin a bit better. So can you break it down? How much was the impact of rates on the net interest margin? So SORA coming down, SOFRA far coming down, HIBOR coming down? And how much was the HQLA deployment impact separately?

So you wanted us to unpack the impact of SORA, HIBOR. We can give you the sensitivity, which I thought we did.

Yes. Su Shan, sorry, not by rate separately. I'm just saying what was the rate's impact? And what was the SQ impact? If I look at the slide where you break down the commercial book and the group NIM. So commercial book was down 5 basis points. Group was down 4%. Is it fair to say that HQLA impact was plus 1 basis points on the NIM? That's the only number that we're going for.

Yes. So Akash, maybe I'll try and give this Phil. Maybe I'll try and give a bit of color there, right? So bear in mind that the average group NIM is in the 180s, right. When we deploy surplus deposits, we typically get 1% to 1.2%, depending on which currency you're talking about. So there's a dilutive impact on NIM. But as we've always said, our guidance is on NII, right? Because NI in dollar terms is what they're targeting. And Su Shan was talking about 17% ROE and so on. Really, the ROE and the NII are what we are focused on. So it's not easy to tear apart exactly how much was created by this particular size of deposits versus that. So I'd encourage you to look at the NII line, and that's for the sensitivities that Su Shan mentioned.

Yes, I totally understand that. I understand it's positive for NII. It's a good business to do. But I'm just thinking from a NIM perspective, because it makes the calculation a bit easier. Out of the 4 basis points, can you say minus 2 the HQLA impact, minus 2 was rates impact? Or any -- like what was that -- because some of the other banks do give us breakdown.

I think maybe we'll come back to you after...

It's quite hard because it depends on how much we get, how much we can do. Okay, we'll come back to you later.

Okay. Good. That would be great. The second question is just on Wealth Management. If you think about your guidance last year, right, it was kind of implying like a $800 million per quarter revenue for Wealth Management. This quarter, we obviously did $900 million plus, which is very strong. But you're still not changing the guidance for the full year. So I'm just trying to understand like what drove this strength in Q1? Was there anything exceptional which you're looking at and saying we shouldn't change the guidance for now? And what would also be very helpful here is if you can break down this $900 million, 5 months? Like how is Jan and Feb? And how was March? I'm guessing March was slower than Jan and Feb. But please correct me if I'm wrong.

Yes. So yes, we I think what we are seeing is, as Tse Koon said, right, I mean, banca did very well and banca tends to be countercyclical. Investments tends to be cyclical. So the markets are up, investments are up, markets are down, investments are down. So because that part is hard to predict, we're not raising or changing any of our guidance on wealth. I mean we obviously don't -- we don't hold ourselves to our budget, right? If the markets are good, we do our best. If the markets are bad, we hunker down. But I think what has been a pleasant surprise is the banca side has been really outstanding. And that's because as I said, right, I think customers are seeing us as a long-term wealth manager of choice for the next generation. And that's why they're coming to us to do these long-term plans. And these long-term plans take time to hatch. They don't happen overnight. It takes months, right? You've got to get the guy in, the wife, the children, they're going to do health checks, you got to discuss estate planning, all very sensitive things. And these take months, if not years, to hatch, but it's hatching now, right? So but that's based on our years of investments in the team, the family office team. Even in the SME team. So what's pleasing for me on Banca is we're starting to see also my SME teams, my corporate bankers, discussing key man risk with their key main clients, family-owned businesses because they should and they have to as a great solution for our clients. And so that's also pleasing for me. So I think Tse Koon already gave some guidance on April. So just expect that when markets are down, the fee for investments will be down, and we hope to mitigate that with banca fees, and we hope to mitigate that with new to bank customers.

Yes. And at the same time, as I also guided also mitigate that with actually the approach we have taken to Wealth Management, which is not 1 of just trading in and out, but really taking the opportunity to build a portfolio. So I've also mentioned that it's not just about equities. Just for discussions take we have also onboarded a whole series of funds, including hedge funds. So in some volatile times, actually, the hedge funds can do really, really well. And we have seen customers also starting to put their money to work through hedge funds. So there are -- there is a full suite of solutions that we have to kind of navigate through these volatile times, right? So the first primary impact, of course, overnight, things happen, you might see the market move. But along the way, we have, I do believe what it takes from a strong customer base to a full suite of solutions.

Yes, Aakash, the way you're coming from, I think the words we guided to high single digits for the commercial book, noninterest income. High single digits is a range. So I would say it's gone up a bit. It's not just high single digits, if that satisfies your kind of curiosity or why you did a 900 plus very strong and you're still not changing your guidance.

And just bear in mind, Aakash, because seasonality, you usually can't take 1Q times full.

Sorry, the last question -- that's very helpful color. The last question is just on Hong Kong CRE. And you also mentioned that how property market seems to be bottoming out, recovering residential property prices have been up for like 11 months in a row. Are you starting to expect recoveries from this book? Or are you still expecting NPLs this year?

So I am more constructive from Hong Kong CRE now, but it is very much location-specific. So Central Grade A office properties like the U.S., right? New York, Grade A, Manhattan, Grade A., London, Grade, it's all doing well. The fringes are not less so. So we don't have -- Hong Kong CRE exposures are really just to the top quality blue-chip names, and they're actually seeing a nice recoveries. Some of the CEOs that told me their rentals and Central have gone from HKD 90 to HKD 130 per square foot. So that's real recovery. And you see the big hedges -- hedge bonds and II, and even the big tech companies have come back to Hong Kong Central and taken up floors, right, some taken up building. So I am constructive. I'm pleased to see you saw that on the West Kowloon side is seeing quite a lot of movement, people taking more space, helped by the strong capital markets in Hong Kong, helped by the growth of Wealth Management in Hong Kong and helped by the strong support that Hong Kong has seen from the Mainland both its capital markets and its investments in new manufacturing and biotech, et cetera, and et cetera. So yes, I'm more constructive on Hong Kong [indiscernible] .

Can this result in any GP write-backs or any overlays that you have earmarked for the Hong Kong portfolio being up?

We'll continue to assess states [indiscernible].

Thanks, Aakash. We move on to Harsh from JPMorgan.

Yes, am I audible?

Yes, yes.

Okay. Great. So just to understand the NII guidance. If Sing-dollar appreciates and your constant currency balances go down. Is that the main risk between flat NII and slightly lower NII year-on-year?

Sing goes up. Normally...

The potency deposits are pretty strong, right?

It's a fairly -- this is Phil here. It's a fairly second order effect, probably low tens of millions. That's just the translation impact of the U.S. dollar and I stack back into the single functional reporting currency that asking, right?

And I'm trying to understand what are the moving parts because it seems like your language has become more positive on NII between fourth quarter and first quarter. So what are the -- I'm guessing 1 is a $60 billion of hedging and second is Sing dollar. Is there anything else which would [indiscernible].

Harsh, that's not -- we might sound more positive, but honestly, it was tough, it Q1, SORA went down how much year-on-year 150 basis points. SORA was down 150 basis points. Remember what I said about our sensitivity, right? It was $11 million per basis point. So it's not easy, right, it's tough. So you see that. So the big try work or NIM is still so, still beats everything else hands down. But the team did a great job in getting more deposit growth. The team did a great job in hedging. -- and the market is buffering more opportunities for hedging because the market is so volatile, right? So from that perspective, because we're seeing the volume growth, we're seeing the hedging opportunities. We're seeing the fee growth in the neobank that's mitigating the massive so headwinds that was upon us, when we look at the markets last year, at the end of last year, the store headwinds were real and they still are real, right? But offers balance sheet, right? And then keep growing, keep your NTBs keep your CASA wrap and keep your focus on all the growth lines that we're doing and all the credit sort of stress testing that we're doing. So we're spending for -- I think we're on tariff and [indiscernible].

All right. If I could just understand that hedging bit -- Su Shan, thanks to that, and it's incredible how well NII is despite all of these sources. So kudos to your team. But what exactly are you heading? I'm just trying to understand the mechanics of it. Because if it is consensus that this is how, let's say, the sing dollar rates are going to be or U.S. or rates are going to be. Like some peek into your secret sauce, what exactly are you doing to get to this outcome?

Okay, Harsh, Phil here again. So we use a variety of hedging strategies. So they'll be funded, unfunded, some deployment to [indiscernible], but also the loan book itself, right, also gives us certain opportunities to put on hedges. And some of those can be single currency, some can be cross currency. So we sometimes we basis swaps. So there's a variety of hedging strategies that we that implied that's probably what I would say on the matter.

There is nothing 1 big thing which we can point to that this works very well because of cross-currency swap spreads went down. So it's nothing like -- it's across the board. So there's nothing that we can monitor is what I'm trying to get to.

We are very opportunistic and in particular periods, we will see opportunities in 1 market run other periods, we will see opportunities in other market. But overall, look at the outcome of the hedging strategy, look at the margin we're able to get after those are the numbers you can kind of look at and get a sense of how we're doing. So mitigate a very, very large SORA of headwind that Su Shan just mentioned.

Perfect. And final question is on capital. Under what conditions will the bank not increase the dividend by $0.06 in fourth quarter?

Under what circumstances. Yes. I mean if the wall continues, the market meltdown, the sacculation, demand disruption. So it depends on the macro, cash. So I don't want to overcommit now because we still have quarters ahead of us, and it's a very difficult environment to predict, which is why the team and I just focus on future's balance sheet, focus on growth, focus on credit, and built a strong foundation. Then by Q2, Q3, we should have more visibility. Sorry, I can't give you any guidance because I really don't know [indiscernible].

I understand that. So is it fair to say unless there is a reasonably bleak outcome, we should probably get that pickup?

Hope so.

No, that is all. I understand. You can't commit and I understand world is a difficult. Final question is on buyback. The capital set aside for buyback. What are the uses of that capital? How long will you wait for the stock to come back to come down? And if it continues to go up, whether are 5 or 10, 12 months from now, what do we do with that capital set aside for buyback?

Well, we've done 12%, right?

$400 million.

Yes, we've done $400 million, got $2.6 billion left. We said that we had up to 2027. So we've still got 1.5 years more to the side. So we will definitely keep you posted. As of now, because we coat whether the market will crash or not, I don't want to commit either way. but we will be prudent with the use of it, and we will keep to our promises.

So if -- sorry, sorry, sorry, Nick, I know I'm overstepping here, but just final thing. If we do not use this capital, is there a possibility that some of it can be paid back by end of '26? Or will you wait until end to pay back that $2.6 billion in what format?

We said it's 2027. So the buyback -- so yes, so we would still wait until 2027. If we don't actually do the buyback quantum in the -- in what we have committed, we will do it in the form of some kind of dividend is there [indiscernible] step to support, at least you have that sort of comfort that if all how breakthroughs and the markets tank, you've got that support that potentially.

Next question from Nick from Morgan Stanley.

First, just coming back to just balance sheet growth, actually. I wonder if you could just make any comments on sort of appetite to borrow from your customers? I mean is it sort of the way you're seeing working capital given lending because price is going up? Or is it that there is sort of still appetite for CapEx and any view you have on how that continues. And just linked to that, I know you've mentioned lots of reasons why you are getting deposits, but was there anything particular in Q1 that drove our deposit growth. And I've got a couple of other questions, after this.

Okay, I'll take the balance sheet growth question first, and you were asking about loan growth. I'm actually quite happy to see that the non-trade corporate loan growth pipeline is quite decent. First Q was driven by all the growth industries, right? So TMC data centers, tech platform, metals and mining, some real estate in Singapore for the government NAND sales. Although Hong Kong surprisingly, I guess that speaks to the recovery in the Hong Kong property market. How long we saw quite a lot of repayments in the real estate sector because they managed to sell a lot more and they could repay us. For second quarter, we continue to see decent growth. We've got a couple of big deals in the pipeline that I hope will go through. And it's in energy and renewable some real estate and some acquisition financing and again, TNT as well. So fairly decent in terms of the -- these are all mostly large corporates. We're not really growing in the midsize or SMEs right now. Kind of we growing in the consumer unsecured side. Then it depends, right? The couple of deals that I mentioned I hope to see them through is almost at the last stages, but anything can happen. So I don't want to dance -- and then trade loans as well, that seems tends to be quite end of quarter type of trade loans. But again, a lot of it around the AI server value chain, working capital for energy and renewables, and supply chain for chips. So again, that comes in normally at the third month of each quarter. Your second question was around deposits. But what was the question on deposit?

Yes. You've given obviously lots [indiscernible] specific in Q1 that had driven that deposit.

Sorry, Nick, you were breaking up. I lost you for a bit.

Yes. No, my question was, you obviously saw good deposit from the first quarter, and you've mentioned lots of reasons why deposits are coming in. And generally, but I'm just wondering if there was any 1 factor that had driven deposit flows in the first quarter?

It's broad-based in to growth. And there was some first quarter, there was some retail seasonal bonus in Sol. There was corporate operating balances. There was -- we had a couple of successful FD campaigns as well. And I think the work that we're doing around our AI models around our campaigns, whether it's for the multiplier or for bundled products for corporate or SMEs is working I think a lot of it is just focused, right? We told the team, he focused on growing operating accounts, focus on winning mandates, focus on new-to-bank. So whether it's SME, CASA, whether it's large corporate operating balances, whether it's wealth, new accounts, whether it's retail, CASA bonus, it's just all saline firing for cash.

Okay. Perfect. And then my second question, just on bank and you've mentioned how it's grown and how it's important as a driving well. Can you give us any disclosure on roughly how much of your wealth management is coming from banker and how that changed Q-on-Q?

Well, how much is Banca versus -- it's roughly about 20% of total fees -- total fee income.

Terminal fees or total wealth fees?

Total wealth fees. I think it was on [indiscernible].

Yes, that's right. So we don't give details on Banca but about 20% of total wealth fees and have seen substantial increase from last year.

But it's lumpier, Nick. So if you have 1 big policy, sometimes it's lumpy. But as I mentioned, a lot of it depends on new-to-bank customers. And also we're getting some success around SME human policies as well.

And sorry, just 1 final one. CVG Wealth Management net new NPA formation in 1Q was 61%, which just looks like a bit of an outlier. I know it's small in the group context. Was there anything that drove that?

Yes, absolutely secured. So it should be okay. It's a 1 lumpy situation that will secure.

Last question, Sukriti, from Bank of America.

Congratulations on a good read of results. Can you hear me?

Yes. Go ahead.

Yes. Okay. So just keeping sort of 2 questions. One, just wanted to understand said on road should broadly GDP, but given the ongoing macro uncertainty, is there a risk that you see that loan growth surprises to the downside in the second half if corporates turn more cautious and what are some of the pockets many most watchful?

Yes. Well, I think we -- we're very focused on where we want to grow our loan book. So we're very nuanced on what we're avoiding as well. So as I said, the team knows that we want to go eat growth. And so that's TNT, the big as a whole semiconductor supply chain and avoiding the riskier credits. So I think -- and also renewables, of course, and then there's quite a lot of M&A deals in the pipeline. So I think we're good. Will it be canceled in the second half. So it really depends. So if the wall continues, then there is going to be downside risk, I think, on the asset book growth as deals get canceled. So -- but so far, from the pipeline that we're seeing, it looks okay. what has the price here on the downside people are repaying also right? It's not a bad thing. As I said earlier on, I said I didn't anticipate Hong Kong real estate loans to be repaid so quickly, but they were all repaid quite quicker than I anticipated. So in a way, it's good for credit, but it's less by asset book. But I think there is enough certainly in the TNT pipeline has enough around the corporate trade loans for the foreseeable future this year. Let's see. I mean, if the second half looks bad because of Iran then, we might have to shave a couple of billion of budget, but it's okay. I think we'll continue to grow deposits, and we'll continue to redeploy the excess deposits. So my NII, hopefully, we will still be in line with our own project projections.

And actually a follow-up there on the deposit side. We mentioned all deposits are accretive. But at what level do you see that excess dip orders become ROE dilutive? And how do we think about continued deposit growth if there's a risk that loan growth is not as high?

Doesn't matter, you want to go all out for deposit growth, right? Cash is king. Cash is queen. Cash is everything. So just go all up for deposit growth. Your loan growth, you'll be structured by the credit worthiness and the ROE and the cross sell and all that, and we are very careful about avoiding the bad credits and being instructive on trust testing, et cetera. But deposit growth just go on and win market share. at whether your loan growth is muted or not, you just go all out for the deposits you can redeploy that in H2 HQLA ROE. It's. It's good credit.

Yes, it will be NIM diluted. [indiscernible].

But don't worry about the NIM, look at the NII and look at the ROE.

Okay. Thanks, Sukuti. That's all the time we have. So thanks, everyone, for dialing in. We will speak to you again next quarter. Thank you.