OCBC profit falls 6pc to S$1.17b
Oversea-Chinese Banking Corp Ltd (OCBC), Singapore’s second-biggest listed bank, said quarterly profit fell six per cent, hurt by a one-off charge for its Indonesian unit that overshadowed growth for its wealth management and lending businesses.
In particular, higher wealth management fees helped offset a challenging environment as Singapore narrowly dodged a recession in the third quarter due to the trade war between United States and China, two of the citystate’s biggest export markets.
“Our performance for this quarter underscored the competitive strength of our diversified business franchise,” said chief executive officer Samuel Tsien.
“Global and regional economic growth continued to slow, and geo-political event risks have increased. We will remain vigilant and maintain prudent risk management practices while exercising disciplined cost management.”
Net profit came in at S$1.17 billion (RM3.56 billion) for the JulySeptember quarter, the lowest level in three quarters, but in line with a S$1.19 billion average estimate of five analysts, according to data from Refinitiv.
Excluding the one-off charge at its Indonesian unit that was related to changes in expected credit loss modelling, OCBC’s core net profit was S$1.26 billion, slightly higher than the S$1.25 billion booked a year earlier.
Net wealth management fees rose 11 per cent year-on-year, while OCBC’s net interest income grew six per cent to S$1.60 billion and net interest margin rose five basis points to 1.77 per cent.
After clocking robust growth rates in recent years, Singapore’s banks face a challenging outlook as interest rates soften and loan growth moderates. Its central bank eased monetary policy for the first time in three years last month.