SINGAPORE – DBS Bank customers can look forward to better service and greater peace of mind when transferring funds, following an overhaul of the bank’s systems in the wake of several outages in 2023, its chief executive said on March 28.

“I am quite confident that you will be able to see greater and better service availability. You’ll be able to use alternative channels if something does go down... and have better confidence about payment certainty, both for payer and receiver,” DBS Group CEO Piyush Gupta told shareholders at an annual general meeting.

Mr Gupta said efforts to ensure that the bank can provide “complete clarity” to customers on whether PayNow transactions and fund transfers are done have been successful, and that options for them to use alternative channels when the system is down will be available by end-April.

He acknowledged that pending transactions due to lags in the system can cause customers a lot of uncertainty, such as whether to make a duplicate payment or not.

“We’re working very hard to try to eliminate the uncertainty so you’ll get complete clarity on whether the transaction is successful, or the transaction is not successful,” he said.

He added that a special board has been formed and senior executives, including a new tech leader, have been hired to focus on managing technology risks.

The moves come after a string of technology outages at the bank in 2023, including one on Oct 14, 2023, when its online banking and payment services were down for hours, while its ATM services were disrupted at several locations, prompting disciplinary action by the Monetary Authority of Singapore.

As a result of the disruptions, Mr Gupta also saw his total remuneration for the financial year ended Dec 31, 2023, decline by 27 per cent to $11.2 million, compared with $15.4 million the year before.

The Republic’s biggest bank is aiming for a return on equity (ROE) of 15 per cent to 17 per cent in the medium term, or over the next three to five years.

“Interest rates have come down from 5.5 per cent. We think the new normal is closer to 3 per cent, but even in that environment, we think we can continue to deliver 15 per cent to 17 per cent ROE,” Mr Gupta said.

ROE is a gauge of a corporation’s profitability and how efficiently it generates those profits. The higher the ROE, the better a company is at converting its equity financing into profits.

Mr Gupta said the drivers include faster growth among its high-ROE businesses, such as wealth management and global transaction services.

DBS, which is also South-east Asia’s biggest bank by assets, posted a record ROE of 18 per cent in 2023, which Mr Gupta said was one of the highest among the biggest banks globally. Its ROE in 2022 was 15 per cent.

On the regional front, DBS will allocate $300 million to $500 million capital to its India operations over the next three to four years and grow profitable consumer and small and medium-sized enterprise banking businesses there, Mr Gupta said.

DBS is also bullish on China’s Greater Bay Area, and China in the long term, Mr Gupta said. The bank announced in end-December that it was raising its stake in China’s Shenzhen Rural Commercial Bank in a $376 million deal.

• Additional reporting by Reuters.