FINANCIAL SERVICES | Staff Reporter, Singapore

UOB profit up 28% to $1.08b in Q2

Earnings were boosted by net interest income which hit $1.54b.

UOB maintained its positive growth momentum after the bank’s profits surged 28% YoY to $1.08b in Q2 on the back of strong operating income, according to its financial statement.

Also read: UOB raises One Account deposit rates by 0.55%

Net interest income rose 14% YoY to $1.54b amidst steady loan growth which hit 10% in Q2. Net interest margin, a common indicator of profitability, also rose 8 basis points to 1.83%.

Net fee and commission income also hit $498m amidst robust growth in loan-related, fund management, credit card and trade-related fees.

The bank declared an interim dividend per ordinary share of 50 cents.

However, the bank’s total expenses also grew by 10% YoY to $1.02b amidst higher staff expenses and IT-related investments. UOB’s cost-to-income ratio stood at 43.6% in Q2.

“Testament to our focus on generating sustainable growth, our second quarter results are built on the healthy growth momentum in the first quarter,” Wee Ee Cheong, deputy chairman and CEO at UOB said in a statement.

The government's cooling measures are expected to hit UOB the hardest of its peers due to its greatest exposure in property-related lending. The bank's housing loans are estimated at 27.9% whilst OCBC and DBS are at 27.6% and 21.4% respectively, according to UOB Kay Hian.

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