DBS Group Holdings Ltd Annual Report 2016 Reimagine …

1 DBS Group Holdings Ltd Annual Report 2016 ReimagineBankingWorld s Best Digital BankLiving, Breathing AsiaAbout usDBS is a leading financial services Group in Asia, with over 280 branches across 18 markets. Headquartered and listed in Singapore, we have a growing presence in the three key Asian axes of growth: Greater China, Southeast Asia and South Asia. Our AA- and Aa1 credit ratings are among the highest in the world. We have also been recognised for our leadership in the region, having been named Asia s Best Bank by several publications including The Banker, Global Finance, IFR Asia and Euromoney since 2012. In addition, we have been named Safest Bank in Asia by Global Finance for eight consecutive years from 2009 to 2016 .

2 Reimagine BankingWorld s BestDigital BankWhat makes DBS the World s Best Digital Bank?It starts with reimagining banking . From Singapore s favourite mobile wallet to India s first paperless, branchless, signatureless mobile-only bank. A first-in-its-class social network for SMEs to hackathons across Asia and fintech internships in DBS. These are just some of the reasons we have been recognised as the World s Best Digital Bank. Our digital transformation pervades every part of the bank. We are driven by one relentless purpose, which is to live and breathe innovation to Make banking Joyful. View our Report onlineOur Annual Report , accounts and other information about DBS can be found at About this reportThe Board is responsible for the preparation of this Annual Report .

3 It is prepared in accordance with the following regulations, frameworks and guidelines: The banking (Corporate Governance) Regulations 2005, and all material aspects of the Guidelines on Corporate Governance for Financial Holding Companies, Banks, Direct Insurers, Reinsurers and Captive Insurers issued on 3 April 2013 by the Monetary Authority of Singapore. The International Integrated Reporting <IR> Framework issued in December 2014. The Global Reporting Initiative (GRI) G4 Sustainability Reporting Guidelines issued in May 2013. This positions us well to meet the Singapore Exchange sustainability reporting requirements as well as The Association of Banks in Singapore Guidelines on Responsible Financing that will take effect in 2017.

4 The Enhanced Disclosure Task Force recommendations to enhance banks risk disclosures issued in October 2012. We have implemented most of the recommendations, including those pertaining to expected credit loss approaches issued in November 2015. | 12 Who we are 4 Board of Directors6 Group Management Committee8 Letter from the Chairman and CEO12 World s Best Digital Bank20 CEO reflectionsOverviewThis section provides information on who we are and our leadership team. It also contains messages from the Chairman and How we create value our business model24 How we use our resources27 How we distribute value created28 Material matters30 What our stakeholders are telling us32 CFO statement38 Our 2016 priorities42 Institutional Banking44 Consumer banking /Wealth ManagementBusiness Model This section discusses our business model and provides details on how we use our resources and distribute value to our section provides information on our financials.

5 2016 priorities and performance by customer Corporate governance 64 Remuneration Report 70 Summary of disclosures74 CRO statement77 Risk management103 Capital management and planning108 SustainabilityGovernance and Risk ManagementThis section details our commitment to sound and effective governance, risk management and Reports120 Financial statements183 Directors statement187 Independent auditor s report193 Five-year summaryAnnexure194 Further information on Board of Directors199 Further information on Group Management Committee201 Main subsidiaries and associated companies202 International banking offices204 Awards and accolades wonShareholder Information206 Share price207 Financial calendar208 Shareholding statistics210 Notice of Annual General Meeting Proxy form2 | DBS Annual Report 2016 Who we areDBS is a commercial bank headquartered and listed in Singapore.

6 As one of Asia s leading banks, we understand the intricacies of the region s markets, and provide a full range of services in consumer banking , wealth management and institutional banking . To continue staying at the forefront of the industry, we are reimagining banking , using digital technology and innovation to extend our reach, enhance our efficiencies and create tomorrow s solutions. We are proud to be recognised not only as Asia s Safest and Best Bank, but also World s Best Digital bn200,0007 mil*22, bnTotal Assets (SGD)OverOverOverInstitutional banking CustomersConsumer banking /Wealth Management Customers* As at February 2017 EmployeesIncome (SGD)Net Profit (SGD)66%25%9%SingaporeGreater ChinaSouth, Southeast Asia and Rest of the Worldof Group incomeof Group incomeof Group incomePresent in 18 markets globally, including six priority markets in AsiaSingaporeIndonesiaIndiaTaiwanChinaHo ng Kong| 3 Leaders in digital banking talk about the difference between digitising aspects of a bank and creating a truly digital financial institution.

7 DBS is doing this better than any other bank. It is demonstrably the case that digital innovation pervades every part of DBS, from consumer to corporate, SMEs to transaction banking and even the DBS Foundation. Clive Horwood Editor of Euromoney MagazineWorld s Best Digital BankEuromoney Awards for Excellence 2016 Who we areSafest Bank in Asia by Global Finance 2016 Asia s Safest, Asia s BestAsia s Best Bank by Euromoney 2016 Most Valuable banking Brand in ASEAN and Singapore by Brand Finance 2016 Peter SeahEuleen GohPiyush GuptaBart BroadmanThe Board is committed to helping the bank achieve long-term success. The Board provides direction to management by setting the Group s strategy and overseeing its implementation.

8 It ensures risks and rewards are appropriately diversityTwo of nine directors are independenceA majority of our directors including the Chairman are non-executive and independent banking knowledge and experienceTwo-thirds of the Board are seasoned bankers, while the rest have extensive industry experience ranging from consumer goods to Directors4 | DBS Annual Report 2016Ow Foong PhengHo Tian YeeAndre SekulicNihal KaviratneDanny Teoh| 5 Board of DirectorsThose marked by * are also in the Group Executive Committee. For more information on the Group Management Committee, please refer to pages 199 to Gupta*Chief Executive Offi cerJimmy NgAuditLam Chee KinLegal, Compliance & SecretariatKaren NguiStrategic Marketing & CommunicationsJerry ChenTaiwanSurojit ShomeIndiaPaulus SutisnaIndonesiaDavid Gledhill*Technology & OperationsThe Group Management Committee executes the strategy and long-term goals of the Group .

9 It drives business performance and organisational synergies. It is also responsible for protecting and enhancing our brand and one-third of our Group Management Committee members are years of experience of the Group Management | DBS Annual Report 2016 Lee Yan HongHuman ResourcesSim S Lim*SingaporeElbert Pattijn*Risk ManagementAndrew Ng*Treasury & MarketsNeil GeChinaShee Tse KoonStrategy & PlanningJeanette Wong*Institutional BankingSebastian Paredes*Hong KongTan Su Shan*Consumer banking /Wealth ManagementChng Sok Hui*FinanceEng-Kwok Seat MoeyCapital Markets| 7 Group Management Committee8 | DBS Annual Report 2016 Letter from the Chairman and CEO We made good progress on our strategy.

10 Delivering strong operating performance and cost effi ciencies, as well as solid returns. Chairman Peter SeahAn eventful yearIn 2016 , the global economy registered tepid growth for the sixth year. Markets were volatile, exacerbated by political shocks such as Brexit and the results of the US presidential elections. Across the globe, a rising tide of populism and discontent reared its head, adding to the uncertainty. Technology disruption also continued to force rapid change upon businesses and whole industries. Against this backdrop, we made good progress on our strategy, delivering strong operating performance and cost effi ciencies, as well as solid returns. These results are commendable given China headwinds which reduced customer activity, as well as the collapse of oil prices which caused stress in the offshore oil support services sector.