UOB's profits up 18% to $2.96b in 2018

Total income for their Retail, Wholesale Banking and Global Markets also rose.

UOB’s profits rose 18% YoY to $2.96b (S$4.01b) in FY18 amidst strong performance in in loan-related, credit card, trade-related and fund management fees.

Total income increased 13% YoY to S$6.22b. Other non-interest income declined 20% to S$930m mainly due to unrealised mark-to-market on investment securities and lower gains from sale of investment securities. Net interest income rose 10% YoY to S$1.61b led by 11% growth in loans whilst net interest margin dipped slightly to 1.80%.

Total income for Group Retail rose 4% to S$3.95b, supported by healthy volume growth and deposit margin improvement. Group Wholesale Banking reported an income growth of 11% to S$3.94b, led by double-digit loan growth and broad-based increase in fee and customer treasury income. Total income for Global Markets grew 6% to S$465m amidst favourable movements in foreign exchange and rates.

Meanwhile, total expenses increased 7% to S$4b, largely driven by higher performance-related staff costs and IT-related expenses.

Also read: UOB launches its first digital bank in Thailand

The proposed final tax-exempt dividend stands at 23 cents per share, representing 21% YoY increase from the final dividend of 19 cents and a 15% rise from the interim dividend of 20 cents. Together with the interim dividend of 20 cents per share, this will bring the FY18 total dividend to 43 cents, up 16% or 6 cents, from 37 cents per share in FY17.

In 4Q2018, the group reported net earnings of S$916m, 7% higher from a year ago. Net interest income rose 10% to S$1.61b led by 11% growth in loans whilst net interest margin dipped slightly to 1.80%.

Net fee and commission income declined 8% to S$467m as higher fees from credit cards were offset by lower wealth management and loan-related fees amidst market uncertainties. Whilst growth in customer-related flows remained stable this quarter, other non-interest income fell 46% to S$140m mainly due to unrealised mark-to-market on investment securities arising from market volatility. Total expenses reduced 4% to S$984m driven by lower revenue-related and staff costs.

Compared with last quarter, net earnings decreased 12% to S$916m. Net fee and commission income fell 4% to S$467m, due to lower wealth management and loan-related fees on the back of subdued market sentiment. Other non-interest income fell 42%, driven by lower trading and investment income, which offset growth in customer-related flows.