OCBC profits jumped 12% to $806.53m in Q3

Net interest income grew 9% to S$1.51b.

OCBC recorded a profit increase of 12% YoY to $806.53m (S$1.25b) from $1.11b in Q3, an announcement revealed. On a YTD basis, it climbed 18% to $3.57b in September from $3.01b a year ago.

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“Record quarterly and year to date net profit were achieved through improved NIM, continued loan growth, higher non-interest income, and continued cost management discipline,” OCBC CEO Samuel Tsien said.

The bank’s net interest income rose 9% to S$1.51b in Q3 from $1.38b a year ago. The growth was backed by broad-based growth in customer loans of 10% and a 6 basis points rise in net interest margin (NIM) to 1.72%. The increase in NIM was pushed by improved margins in Singapore, Malaysia and Greater China, and a higher average loans-to-deposits ratio.

OCBC also revealed that their operating expenses climed 7% YoY to S$1.07b amidst increase in staff costs associated with annual base salary increments and a rise in expenses linked to business volume growth. Meanwhile, allowances for loans and other assets were lower at S$49m as compared to S$156m a year ago.

The firm’s non-interest income for Q3 which stood at S$1.04b remained relatively unchanged. Fee and commission income inched up 3% to S$502m amidst higher wealth management, loan and trade-related fees.

Net trading income, mainly comprising treasury-related income from customer flows, skyrocketed 80% to S$213m. Profit from life assurance was down to S$184m from S$253m a year ago amidst higher mark-to-market gains from a more favourable market condition a year ago.

In Q3, the average Singapore dollar and all-currency liquidity coverage ratios for the Group were 232% and 130% respectively, whilst the net stable funding ratio was 108%.

“Despite the weakened regional market sentiments as a result of global trade tensions, the growth in our wealth management franchise continued, with sustained net new money inflows that drove our assets under management to an all-time high,” added Tsien.