DBS +0.7%; To buy MBFC stake for $1.035b

DBS is up 0.7% at $14.89, in line with the STI’s 0.8% gain, after the bank said it will pay $1.035 billion for a stake in Marina Bay Financial Center Tower 3, where its headquarters is located.

“I don’t think it was expected, but it’s not a surprise either,” an analyst says. “The positive part about it is they do need some security in terms of the permanence of their location for operation. So this is quite a good move over the longer term,” he notes; “they really do need a permanent operating base. This really is a means toward securing that permanence.”

He adds that he doesn’t see any negatives for the deal. With the stock tapping its highest levels since December 2007 and volume slim, orderbook quotes suggest it will likely struggle to top its $14.90 intraday high.