#10000- 10001 XDBS Our digital strategy 600000 10019 100101 10001 CITICIC0 Piyush Gupta Chief Executive Officer 110010000110 0010100-0-0-00 00011 00111001010100 10100 -0000 10010 0 00 01 01 10 001 00 6000110101010 000 110 00 011 100 00 0 0 10 -0000-0000-00-0-00-000000 0000-0000-0000-0000-00-011100 0000-0000-0000-00-00-0-0000 17 November 2017 DBS The presentations contain future-oriented statements, including statements regarding the Group's vision and growth strategy in the light of anticipated trends as well as economic and market conditions. Such statements necessarily involve risks and uncertainties, which may cause actual performance in future periods to differ from projections. 111#2Agenda 01 Our Investment Thesis: 2009 02 2014: Our Digital Transformation Journey 03 Creating Shareholder Value from Digitalisation 04 Today's Agenda ☑DBS 2#301 Our Investment Thesis: 2009 ☑DBS 3#4Our Investment Thesis: 2009 Create an Asia-centric commercial bank that delivers double-digit ROE and growth rates in a diversified manner Capitalising on megatrends in Asia ☑ Intra-regional trade and capital flows ==== Urbanisation and infrastructure investments Increasing consumption and growing affluence Distinct from local lenders and global players through an Asian Way of Banking DBS 4#5о |000 KEY STRATEGIES Build a diversified regional Corporate Bank Build a regional Wealth business EA Regain universal banking leadership in Singapore (Retail, SME) Build out SME in Growth Markets; get into consumer finance opportunistically DBS 5#6Diversified Regional Corporate Bank Corporate Bank Income1 (S$m) 1,746 16% CAGR Achieved good outcomes by 2014 % of income1 2009 2014 Trade, Cash, Treasury 29% 44% Loan 66% 52% 3,639 2009 2014 1 MIS view 2 Based on market penetration in our markets (source: Greenwich survey) Built niche, profitable business in capital markets Today, ranked 4th in Asia² ☑DBS 6#7$ Regional Wealth Business Achieved good outcomes by 2014 Wealth Management Income¹ (S$m) 499 18% CAGR 2009 2014 Ranking2 Not in top 30 #9 AUM S$75bn S$134bn 1,122 Developed Wealth Continuum, created 3 wealth segments³ 2009 Today, ranked 6th in Asia² 2014 1 MIS view 2 Based on AUM (source: Private Banker International) 3 Treasures, Treasures Private Client, Private Bank DBS 7#8Leading universal bank in Singapore Achieved good outcomes by 2014 Retail and SME Bank Singapore Income¹ (S$m) 1,315 1 MIS view 2 9% CAGR Market positions² 2009 2014 Mortgage #2 #2 Auto loans #2 #1 1,984 2009 2014 Ranking for mortgage, auto loans, cards based on balances (source: Credit Bureau Singapore, Sep 17); Ranking for bancassurance based on new business weighted premiums (source: Life Insurance Association, 9M17) Cards #2 #2 Bancassurance Not in top 5 #2 ☑DBS 8#9Growth Markets SME and Consumer Grew income in Growth Markets, but hard to scale Retail and SME Bank Growth Markets1 Income² 13% CAGR 2009-2014 Net profit² S$18m 2014 SME and consumer finance businesses limited by physical distribution and macro challenges 1 Growth Markets: China, Taiwan, India, Indonesia 2 MIS view ☑DBS 9#10Achieved good outcomes by 2014... Group income (S$m) 1 2009-2014 6,603 9,618 Income 8% CAGR1 2009 2010 2011 2012 2013 2014 Net Profit 13% CAGR1 8.4% 10.9% ROE to 2009 2014 ☑DBS 10#11Globalisation of Platform Giants BANKS PLATFORM COMPANIES BANK E2 Tencent 56000 100 0 00 0R150 1011 ...but the world was changing around us Cost vs Efficiency to Scale Up Pave SparkFund STREET SHARES KAPITALL ARTIVEST PERSONAL CAPITAL moli WiseBanyan Propellr Syde Bit SIGFIG smartassel Start-ups Unbundling Bankingment Loans and Credt Financial Education Wealth Management ads and fts Stilt- zest finance View Your Accounts FOR SALE Loan Now INSIKT lenda Serat Pawar& % CoverHound L the zebra Ledge. nerdwallet everplans aboutLife LEARNVEST Asset Avenue Patch of Land loanlogics FUNDTHATFLIP sindeo Buying a house? Landed Estimate how much you may be able to borrow Figtree blooom Get Prequalified LendingHome earnest TUITION.IO College AVE Going to College Hedg SoFi Moven Payoff digit chime Juvo EMBROKER SimplyInsured covestor Remitly RUSHCARD FUNDBOX varo able BOND STREET IWVA coverwallet for us all insureon Lum ty GO Co GUSTO BEHALF Apple Bank wherever life takes you credit sesame Everyday Checking Whether you're thaoding a checking account, banking on the gor managing your spending Wells Farge makes it say for you to manage you everyday barking Go To Banking Made Easy Get Started lendio beyonic Make saving money LendingRobot SNAPARVANCES, MoCaFi PayActiv Save Savings accent P2Binvestor rize BOOSTUP simpler Automatically save wa OPORTUN Zebit Open a new checking a bread online in minutes PayNearMe Affirm regall thumzap uphold AVANT CREDIT SELFLENDER Upstart LendUp Elevate Credit Karma PROSPERD Cumulus SnapCheck Learn More> BROKE acoms fundera Even JUSTWORKS. Manage Payroll and Check Employees Financing and Credit Make & Receive Payments Get Started with Checking Namely Captain401 next insurance CAN CAPITAL ZENEFITS Dealstruck eShares Credit Junction BlueVine InvestNextDoor Kabbage CREDIBLY C2FO Bill.com flint O DBS VS 3DBS BDBS DBS DBS ☑ 04 Mozido ROMIT Penny WB21 Sansing redefined BILLS GUARD wave zuora TRANSACTIS ((mobeam)) Source: CB Insights 0 X DBS 11 Ո#1202 2014: Our Digital Transformation Journey × DBS 12#13amazon What would Jeff do? × DBS 13#14Our digital business model: 5 key capabilities ACQUIRE • Increase customer acquisition through wider distribution Lower acquisition cost TRANSACT Eliminate paper, create instant fulfilment Decrease cost . ENGAGE Drive 'sticky' customer behaviours, cross-sell through contextual marketing Increase income per customer ECOSYSTEMS: Pipes to Platforms DATA: Be insights driven XDBS 14#15Driving the transformation: Making Banking Joyful Become Digital to the Core Embed Ourselves in the Customer Journey Make DBS 'Invisible' Create a 22,000 Start-up XDBS 15#16FROM BECOME DIGITAL LEGACY TO THE CORE WATERFALL MANUAL PROJECTS TO MICROSERVICES, CLOUD, APIS AGILE AUTOMATED, DEVOPS PLATFORMS OPERATIONS ANALOGUE DESIGN-FOR-NO-OPS PAPERLESS XDBS 16#17My Shopping Make banking 'invisible' (1) My Everyday Life & Goals My Entertainment D: D+ My Utilities $ (2) My Finance Cards Payments CASA (3) My Way My Pension My Child's Education TD Loans Investments Mortgages Insurance My Car My Travel My Wedding My Health My Transport My House My Education XDBS 17#18SQUAD BLOCKERS SYSTEMS INSERTIE CADENCE 20 Dyck 7 To Do IN Proses REVIEW LOST CSAT Results what What makes a 22,000 start-up? Data-Driven ช Take Risk & Experiment 3 Agile Be a Learning Organisation Cord ve to damage went to Pane Cunes fook GM for zonin waited Ex of v Customer Obsessed gamey T LOU 1817 DO 2189 53883 illo St / 322 XDBS 20 min 18#19Tools Employee Immersion Programmes e.g., Hackathons Human-Centred Design Customer Journey Thinking Spaces Collaborative Workspaces Innovation Labs Design Centres Partners Start-ups Incubators/Accelerators Universities Research Agencies × DBS 19#20YOU MANAGE WHAT YOU MEASURE: Balanced Scorecard and Management Processes Then: 50% Traditional KPIs Customers Shareholders Achieve Position DBS as sustainable bank of choice growth 50% Strategic priorities Geographies Regional as employer of choice 40% Today: Traditional KPIs Shareholders Customers Position DBS as Employees Position DBS as employer of choice Making Banking Joyful Achieve Employees Position DBS sustainable bank of choice growth 20% Drive digitally: | Joyful customers Capture value • Acquire . Transact • Engage & employees by focusing on journeys, experiences created from digitalisation 40% Strategic priorities Enablers businesses Regulators Society Geographies Regional businesses Regulators Society Enablers XDBS 20#21Making Banking Joyful KPIs 20% Making Banking Joyful Drive digitally: Joyful customers • Acquire • Transact Engage ACQUIRE & employees by Capture value created from focusing on journeys, digitalisation experiences ▲ Channel share of digital acquisition TRANSACT Channel share of digital transactions ▼Manual transacting efforts ENGAGE ▲ Digital, contextual engagements with customers JOYFUL CUSTOMERS & EMPLOYEES Top 250 senior mangers to sponsor 1 Journey each VALUE CREATED FROM DIGITALISATION ▲ Number of Digital customers ▲ Income per Digital customer Higher income, lower costs: better operating leverage, cost-income ratio, ROE as we shift from traditional to digital XDBS 21#22VISIBLE OUTCOMES: Digital transformation pervasive Tally Live like a boss. digibank Tally TRANSFORMING THE FRONT END... World's Best Digital Bank EUROMONEY AWARDS FOR EXCELLENCE 2016 iWealth Treasury Prism Digital Onboarding BusinessClass POSB Smart Buddy "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." POSB Integrating Fraud Operations Clive Horwood Editor of Euromoney 1111111111 -45% External parties G000 0000 External API laver DBS 0000 0000 digibank Virtual Assistant Contact Centre HR Analytics ATM Analytics Fraud Monitoring Analytics LIE on RMs Core banking systems Open API Platform RE-ARCHITECTING THE BACK END XDBS 22#2303 Creating Shareholder Value from Digitalisation >DBS 23 23#24Unbundling the bank Measuring the digital value created in: Consumer and SME (Singapore, Hong Kong) Our agenda Pre-empt disruptors 1 Corporate Bank, Private Bank, Markets, and Others Consumer and SME (Growth Markets) Disrupt incumbents Other Businesses1 Digitalise for profitability ☑DBS 24 24#25Consumer and SME (Singapore, Hong Kong) Pre-empt disruptors 38% S$4.1bn 2015 income: S$10.8bn ◉ Rapidly transforming to digital Gaining market share, creating new income streams ■ #1 in Singapore in mortgage, auto loans, cards, bancassurance today1 1 Ranking for mortgage, auto loans, cards based on balances (source: Credit Bureau Singapore, Sep 17); Ranking for bancassurance based on new business weighted premiums (source: Life Insurance Association, 9M17) >DBS 25#26Consumer and SME (Singapore, Hong Kong) Pre-empt disruptors +6pp from 2015 Income 11% Cost-income ratio ROE CAGR1 vs Group: 4% 49% 2015 43% 22% 24% 2017 2015 2017 44% S$5.1bn 2017 income: S$11.6bn 2017 figures annualised based on 1H17, where applicable 12015-2017 ■ Jewel in the crown Likely to grow income at double-digit ■ Has potential to contribute ~50% of the bank's income in 5 years >DBS 26#27Consumer and SME (Growth Markets) Disrupt incumbents 4%, S$503m 2017 income: S$11.6bn 2017 figures annualised based on 1H17, where applicable Successfully launched new distribution models in India & Indonesia ■ Still nascent, loss-making ☑DBS 27#28Consumer and SME (Growth Markets) Disrupt incumbents 4%, S$503m 2017 income: S$11.6bn 2017 figures annualised based on 1H17, where applicable ■ A bet on the future ■ Income growth likely to be >20% CAGR ■ Has potential to contribute ~10% of the bank's income in 5 years; aspirational ROE >10% ☑DBS 28#29Other Businesses1 Digitalise for profitability 58% S$6.2bn 2015 income: S$10.8bn 1 Corporate Bank, Private Bank, Markets, and Others ◉ Changing the operating model and the way we work Getting efficiency gains ■ Some digital standouts XDBS 29#30Other Businesses1 Digitalise for profitability -6pp from 2015 52% S$6.0bn ■ Income flat; while Cash Management (16% CAGR²) and Private Bank (26% CAGR²) have been standouts, trading has been a drag ■ Reduced cost³ by ~$100m ■ Income likely to grow mid-single-digit; aspirational ROE ~10% 2017 income: S$11.6bn 2017 figures annualised based on 1H17, where applicable 1 Corporate Bank, Private Bank, Markets, and Others 2 2015-2017 3 2017 vs. 2015 >DBS 30#31Summary Strategy leveraging Asia's megatrends has paid off with diversified growth and higher returns Digitalisation creates opportunity to pre-empt disruptors, disrupt incumbents and improve business profitability Our digital transformation is pervasive, encompassing technology, customer journey and a start-up culture. This is difficult to replicate and creates competitive advantage We have established a management and measurement system to drive this transformation, and a robust methodology to track financials Early results of our efforts are encouraging. Digitalisation has accelerated income growth and lowered structural costs, boosting operating leverage. The opportunity space is significant >DBS 31#3204 enda DBS ASIAX Today's Agenda × DBS 32 32#33Agenda for the day Digital Transformation Technology & Culture Presentations Dave Gledhill, CIO Showcases Tech and Ops | APIs Use of data insights Consumer and SME (Singapore, Hong Kong) Chng Sok Hui, CFO Consumer and SME (Growth Markets) Other Businesses¹ 1 Corporate Bank, Private Bank, Markets, and Others Surojit Shome, India Bancassurance | POSB Smart Buddy digibank | Tally Jimmy Ng, Audit John Laurens, Cash Management Tan Su Shan, Wealth Management Karen Ngui, Strategic Marketing Reimagining Audit Treasury Prism iWealth ☑DBS 33 33#340000- 10001 XDBS Our digital strategy 600000 10019 100101 10001 CITICIC0 Piyush Gupta Chief Executive Officer 110010000110 0010100-0-0-00 00011 00111001010100 10100 -0000 10010 0 00 01 01 10 001 00 6000110101010 000 110 00 011 100 00 0 0 10 -0000-0000-00-0-00-000000 0000-0000-0000-0000-00-011100 0000-0000-0000-00-00-0-0000 17 November 2017 DBS The presentations contain future-oriented statements, including statements regarding the Group's vision and growth strategy in the light of anticipated trends as well as economic and market conditions. Such statements necessarily involve risks and uncertainties, which may cause actual performance in future periods to differ from projections. 111