SG banks beat profit estimates, face slow growth
Singaporean lenders Oversea-Chinese Banking Corp (OCBC) and United Overseas Bank (UOB) have beaten profit estimates, boosted by core markets recovery. However, the banks’ sequential performance has slowed sharply, highlighting challenges to maintain growth.
Singapore’s recovering economy has boosted the demand for mortgages and loans, improving prospects in the country’s banking sector. The country’s flourishing markets have also strengthened the wealth management business.
Meanwhile, OCBC and UOB have joined other global banking establishments such as HSBC and Standard Chartered in indicating strong asset quality after the previous year’s large provisions in the face of the COVID-19 pandemic.
OCBC, Singapore’s second-largest bank, has garnered a S$1.16-billion ($858.75 million) net profit in April-June versus the previous year’s S$730 million. The bank’s profit has dropped 23% from the first quarter.
At the same time, UOB’s quarterly net profit came in at S$1 billion, up 43% from the previous year but remaining unchanged from the first quarter.
Both OCBC’s and UOB’s shares went up on Wednesday in a strong broader market.
In related news, Southeast Asia’s largest bank, DBS Group Holdings, is set to report results on Thursday.