UOB loans expected to grow 4.5%

This will push net interest income to grow 8%.

Following a strong net interest income in the past quarter, Singapore big bank UOB is expected to grow loans by 4.5% yearly.

According to RHB analyst Leng Seng Choon, this will come as net interest margin widens to 1.76%, from last year's 1.71%. This will be on the back of the recent and expected hikes in US Federal Funds rate (FFR).

To recall, net interest margin rose 2bps QoQ to 1.75% due to the Singapore NIMs widening 6bps QoQ to 1.35%.

"Management guided that future NIMs could be flat to slightly wider than the 2Q17 level," the analyst said.

With these expected improvements, the group's net interest income is seen to post an overall growth by 8%.

For the past quarter, UOB recorded a 5% growth to $845m.