OCBC doubles Q1 profit, rounds up strong outlook for Singapore banks

SINGAPORE (CNA) – Oversea-Chinese Banking Corp (OCBC) more than doubled its quarterly profit on Friday as it handily beat market estimates thanks to a robust performance in its wealth management business and a drop in credit allowances.

The results rounded up a strong showing by DBS Group and United Overseas Bank in tandem with a recovering global economy that is helping boost bank earning across many countries.

Senior analyst at Stanford C Bernstein Kevin Kwek said OCBC and DBS had the stronger performance among the banks, though “loan growth for OCBC was however the weakest, flat year-on-year, so any improvement there could help sustain the recovery”.

Net profit for OCBC came in at a record SGD1.5 billion in the quarter ending in March versus the SGD901.9 million average of three analysts’ estimates compiled by Refinitiv. This compared with SGD698 million profit reported in the year-ago period.

The stellar earnings at OCBC, which counts Singapore, Greater China and Malaysia, among its key markets, were underpinned by growth in trading income, fees and commissions and insurance. Allowances for credit losses declined to SGD161 million in the latest quarter from SGD657 million a year earlier.

People pass by an OCBC bank branch in Singapore. PHOTO: CNA