OCBC’s Q1 profit jumps nearly 14%

SINGAPORE: Singapore’s Oversea-Chinese Banking Corp Ltd yesterday reported a nearly 14% rise in quarterly profit, largely led by sustained growth in its wealth management business and robust results from insurance operations.

The city-state’s second-biggest lender said net profit came in at S$973 million (US$692 million) in the three months ended March 31 versus S$856 million a year ago. Net interest margin however contracted 13 basis points to 1.62%.

“We achieved broad-based loan growth, grew our private banking assets under management (AUM), and reported significantly higher fee income,” CEO Samuel Tsien said in a statement.

The bank said the overall quality of its loan portfolio remained stable and although the stress in the oil & gas support services sector continued, sufficient provisions had been made.

OCBC is the last Singapore bank to report results after DBS Group Holdings Ltd beat market estimates and United Overseas Bank Ltd posted better results.

DBS, Singapore’s biggest lender, reported last Tuesday net profit of S$1.21 billion (US$867 million) in January-March versus S$1.20 billion a year earlier and compared with an average forecast of S$1.09 billion from four estimates compiled by Reuters. Total income was up 1%.

Net fee and commission income rose 16%, driven by a 26% jump in wealth management fees to a quarterly record of S$222 million and gains in transaction services and investment banking fees.

The bank’s net interest income was unchanged at S$1.83 billion as the impact of softer Singapore-dollar interest rates was offset by higher loan volumes.

UOB, the smallest of Singapore’s three listed lenders, said net profit rose 5.4% to S$807 million (US$578 million) in January-March from S$766 million a year earlier. Total income grew 7.8% to S$2.12 billion.