Given DBSs extraordinary capital-cushion, observers feel confident a big acquisition is being planned, and Westpac which trades on a price to book of 2.7 times and has a market cap of $13 billion is regarded as the best possible contender.
Westpac derives 93% of its earnings from Australia, while DBS still makes almost all of its money in Singapore. However, the Singapore government, which owns 39.7% of DBS, has been pushing the bank to emulate HSBC and expand its footprint outside its home base.
With this logic in mind, DBS spoke to Westpac last September, and it was rumoured that both sides got close to an agreement. This would have seen Westpac...
