DBS, Singapore's largest bank, said fourth-quarter net profit rose 20 percent to hit S$1 billion, compared with S$838 million in the previous year, helped by higher interest income.

Southeast Asia's largest bank made record full-year profits at S$4.45 billion.

Oversea-Chinese Bank Corp (OCBC), Singapore's second biggest bank, reported better than expected earnings last week.

Net interest margin, a measure of lending profitability, widened to 1.84 percent in the last three months of the year, compared with 1.71 percent in the previous year.

Net interest income in the quarter rose 11 per cent to S$1.85 billion as net interest margin rose 13 basis points.

An analyst poll by Reuters had forecast quarterly net profit at S$978 million.

"The fourth quarter caps a strong year when total income crossed S$10 billion for the first time," DBS CEO Piyush Gupta said in a statement.

Singapore's economy recorded the slowest growth in six years in 2015, at 2.1 percent.

"While unsettled financial markets in recent weeks have created short-term uncertainty, the region's economic fundamentals are sound and the risks associated with slower growth are manageable," Gupta said.

However, the bank said nonperforming loans rose 8 percent to S$2.61 billion in 2015. It recorded a 62 percent increase in bad debts from general commerce.