UOB on Wednesday reported a third-quarter net profit of S$1.25 billion, more than double the figure of a year earlier, but the result missed expectations, The Star reported. The year-ago quarter was a low base because of a surge in credit provisions, and the result fell short of the S$1.35 billion mean estimate from two analysts compiled by LSEG.
Net profit fell 15% from the second quarter, mainly because asset divestment gains booked then did not recur, according to an analysis of the results by Beansprout. UOB's net interest margin narrowed 6 basis points from the previous quarter to 1.68% on higher funding costs, while nine-month net profit rose 27% from a year earlier to S$4.17 billion.
FEES AT A RECORD, TRADING LOWER
Net fee income rose 19% from a year earlier to a record S$733 million, helped by wealth, cards and loan-related activities. Wealth management fees reached a record S$258 million in the quarter, and net new money totalled S$5 billion in the first nine months of 2026.
Trading and investment income fell 33% from a year earlier to S$322 million on less favourable market conditions, the bank said. That weighed on other non-interest income, which fell 29% from a year earlier to S$370 million.
A TOUGHER COMPARISON AFTER AUGUST
In August UOB reported second-quarter net profit of S$1.5 billion, up 10% from a year earlier. Other non-interest income in that quarter rose 37% to S$632 million, boosted by non-recurring gains from asset divestments, and the margin narrowed 8 basis points to 1.74%. The board then declared an interim dividend of 88 cents a share, a payout ratio of about 50%.
"Our results reflect the resilience of our diversified franchise, and the momentum building across our key ASEAN markets," Wee Ee Cheong, UOB's deputy chairman and chief executive, said at the time. UOB is one of three local banking groups, with DBS and OCBC, that dominate domestic retail and corporate banking in Singapore, according to the TGB market profile.
ASSET QUALITY AND THE 2027 OUTLOOK
The non-performing loan ratio eased to 1.5% from 1.6% in the prior quarter, although the Greater China ratio rose to 5.0% from 4.8%. The common equity tier 1 ratio eased to 14.6% from 15.4% after the interim dividend was paid.
For 2027, UOB said it expects mid-single-digit loan growth, net interest income above 2026 levels and mid- to high-single-digit growth in fee income, The Star reported.
THE TGB VIEW
UOB ranks 84th in the TGB Bank Rankings, with US$445.5bn of assets and a 9.1% return on equity at end-2025; on those 2025 figures its returns trailed its two local rivals, DBS Group at 15.9% and OCBC at 12.0%. The margin is the figure to watch: the nine-month average of 1.75% sits at the lower end of the bank's 1.75% to 1.80% guidance for the year. On asset quality, the Greater China non-performing loan ratio rose to 5.0% from 4.8% in the quarter even as the group ratio eased.
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