Oversea-Chinese Banking Corporation Limited reported its financial results for the third quarter of 2022 recording a net profit of S$1.6 billion from S$1.22 billion in the previous year marking a 31% rise and was up 8% from S$1.48 billion a quarter ago.
- The Singapore-based banking group said quarterly net interest income surpassed S$2 billion for the first time, rising 44% to S$2.10 billion on the back of 6% growth in average asset balances and net interest margin (“NIM”) expansion. Amid a rising interest rate environment, NIM rose 54 basis points from 3Q21 to 2.06%, with improved margins across our key markets as the increase in asset yields outpaced the rise in funding costs. Non-interest income of S$1.05 billion was 4% below the previous year.
- Net fee income fell 20% to S$453 million, primarily due to a decline in wealth management fees as customer activities were subdued amid risk-off investment sentiments globally. The decline was partly offset by growth in other fee segments including credit card, loan, and trade-related fees.
- Quarter on quarter, the group’s net profit rose 8% from a quarter ago. Total income was up 9% to S$3.15 billion. Net interest income grew 23% to S$2.10 billion, underpinned by a 35 basis points uplift in NIM. Non-interest income declined 11% to S$1.05 billion, mainly attributable to lower fee and trading income, and life insurance profit.
- For the 3 quarters, the group net profit was S$4.44 billion for the first nine months of 2022 (“9M22”), 14% higher as compared to the previous year (“9M21”), largely driven by net interest income growth and a decline in allowances. Net interest income rose 22% to S$5.30 billion on the back of asset growth and a 23 basis points improvement in NIM.
Group CEO Helen Wong said “We are pleased to have delivered a strong set of quarterly results. Net interest income grew on higher net interest margin and loan growth was sustained. While subdued customer investment activity impacted wealth fees, we continued to attract net new money inflows into our wealth management franchise. Our portfolio quality remained resilient; and our investments to drive franchise growth, raise productivity and deliver operational efficiencies continue to yield positive results.
Looking ahead, the global economic outlook is expected to be increasingly challenging. Backed by our strong balance sheet, we are well-positioned to support our customers and capture opportunities as they arise.”
