Group Income Before Operating Expenses, Operating Expenses & Ratio of Operating Expenses to Income Before Operating Expenses
Income Before Operating Expenses 1998: S$1,906.1 million (+26.0%) 1997: S$1,512.3 million Operating Expenses 1998: S$754.4 million (+53.1%) 1997: S$492.9 million Ratio of Operating Expenses to Income Before Operating Expenses 1998: 39.6% (+7.0 percentage points) 1997: 32.6%
The increase in operating expenses was due to the consolidation of POSBank's expenses from 1 July 1998 and TDB's expenses from 1 April 1998 and a S$73.9 million provision for restructuring costs. Excluding these, the increase in operating expenses would have been 1.3%. The expense-to-income ratio excluding restructuring costs would have been 35.7%.
Group Provisions & Provisions as Percentage of Operating Profit
Provisions 1998: S$996.4 million (+101.1%) 1997: S$495.5 million
Of the total provisions made by the Group in 1998, S$272.0 million of specific provisions were taken against TDB's loans, S$322.5 million for loans to the Regional Countries (excluding TDB) and S$339.8 million for loans to Singapore borrowers and other countries.
The Group continued to set aside additional special general provisions in 1998 amounting to S$157.8 million to meet contingencies which may arise in the future from its regional exposure.
All classified loans have been fully provided for. Provisions as % of Operating Profit 1998: 86.5% (+37.9 percentage points) 1997: 48.6%
Group Total Shareholders' Funds & Return on Average Total Shareholders' Funds (ROE)
Total Shareholders' Funds 1998: S$9.1 billion (+26.8%) 1997: S$7.2 billion
Total shareholders' funds were further strengthened by proceeds from the Bank's 1 for 5 rights issue in May 1998, and the issuance of non-voting convertible preference shares as consideration for the acquisition of the business of POSBank in November 1998.
Return on Average Total Shareholders' Funds 1998: 2.68% (-3.51 percentage points) 1997: 6.19%
Income Before Operating Expenses 
Operating Expenses
Ratio of Operating
