I’m going to talk about DBS shares today.
DBS Bank (SGX:D05) is the titan of Singapore’s financial industry.
Before I get down into details, here’s what you need to know about banks.
Banks are simple businesses.
They take other people’s money (as deposits), then lend it out to companies and people who need money at a higher interest rate.
Now here’s why DBS can be at the top of their game.
The thing is, DBS has amassed a huge volume of deposits.
In fact, DBS holds a 25% market share in Singapore’s deposits.
While OCBC and UOB has 17% and 21% market share respectively.
You can find my OCBC Shares: Your Complete Guide 2021 here.
DBS knows the key to a great banking business is not about lending money at the highest possible interest rate.
Because that will be too risky.
But DBS focuses on collecting as much deposits instead.
Amassing huge deposits give DBS huge financial firepower.