DBS Group's Hong Kong operations and its recently promoted chief executive will be the focus of attention today as it posts second-quarter results, which analysts expect to be little changed from the preceding quarter. Southeast Asia's largest lender is expected to report a net profit of S$280 million (about HK$1.25 billion) for the April to June period compared with its first-quarter net of S$278 million, a wire-service survey of analysts suggested. 'The focus will be on Hong Kong. That's the key drag on DBS' profitability at the moment,' ABN Amro banking analyst Sam Chin said. He added he was looking for net profit of S$295 million, 6 per cent higher than the first quarter's S$278 million. Singapore-based DBS acquired Hong Kong's Dao Heng Bank Group last year for HK$45 billion, or 3.3 times book value. It already owned DBS Kwong On. The Dao Heng buy consolidated into DBS accounts from July 1 last year, leading analysts to compare the just-finished quarter with the January-to-March period of this year, rather than the second-quarter of last year. In the first quarter DBS posted net profit before goodwill charges of S$346 million, of which Dao Heng contributed S$57 million. The SAR's stuttering economy has caused banks to raise their provisions for bad or doubtful loans over recent quarters. Analysts said that Jackson Tai would also be in the spotlight after he replaced the former chief executive and vice-chairman Philippe Paillart, who resigned at the end of last month after just 18 months at the DBS helm. Mr Tai, who joined DBS in 1999, was once president and chief operating officer. In his first few weeks, Mr Tai has made clear he is concerned about the group's costs as DBS reviews its operations, and what he termed 'slogans and showmanship'. In comments to staff issued just after his promotion that constituted an attack on his predecessor's performance, Mr Tai said: 'Decision-making has become clogged at DBS, with second-guessing and circumvention commonplace.' In the first quarter, total staff and operating costs rose 20 per cent to S$459 million compared with the year-ago period, before the Dao Heng purchase. It said that excluding acquisition-related expenses 'and associated restructuring integration costs', operating costs fell 15 per cent. The cost-to-income ratio was 44.8 per cent in the first quarter compared with 47.4 per cent in the same quarter last year, and 49.1 per cent for last year as a whole. The economy in Singapore - which remains the core DBS market - is gradually recovering after last year's gruelling recession, when gross domestic product shrank 2 per cent. This year the government expects growth of between 2 per cent and 4 per cent.