Why comparing DBS, OCBC, and UOB on surface-level ratios misses the real picture
The debate over DBS, OCBC, and UOB usually dissolves into a race to see who has the highest NIM or the juiciest dividend yield this quarter, but looking at those ratios in isolation misses the structural trade-offs each management team is making.
A high Net Interest Margin (NIM) isn't inherently a win if it's being driven by riskier regional credit exposure that spikes non-performing loans later. Similarly, a massive CET1 ratio looks great on a flyer for safety, but if that excess capital isn't being aggressively deployed or paid out, it acts as a structural drag on Return on Equity (ROE) and prevents the stock from rerating.
Understanding how these three metrics actually push and pull against each other completely changes how you value the Big Three, especially as we transition into a shifting interest rate environment. I've mapped out a breakdown of how these mechanics work under the hood specifically for the SG banking landscape: https://stockbutts.com/nim-roe-cet1-explained-singapore-banks/
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