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UOB on Wednesday (May 8) reported a net profit of S$1.49 billion for its first quarter ended Mar 31, 2024, down 1.6 per cent from S$1.51 billion a year earlier.
The earnings beat the mean estimate of S$1.43 billion from three analysts polled by LSEG.
Excluding one-off expenses incurred in the acquisition of Citigroup’s consumer banking businesses, the bank’s net profit would have been 0.7 per cent lower year on year at S$1.57 billion from S$1.58 billion.
Quarter on quarter, net profit was up 6 per cent from S$1.4 billion in Q4 FY2023, supported by record trading and investment income and higher net fee income, the bank said.
Total income remained relatively flat year on year at S$3.52 billion, as a drop in net interest income was offset by gains in net fee income and other non-interest income.
Net interest income for the quarter fell 2 per cent to S$2.36 billion as net interest margin dropped to 2.02 per cent from 2.14 per cent.
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Net fee income was up 5.1 per cent to S$580 million from S$552 million, buoyed by a stronger showing in loan-related fees and the wealth segment. Credit card fees, meanwhile, normalised from a seasonal high in the last quarter.
Other non-interest income was 3.2 per cent higher at S$581 million from S$563 million in the same period a year earlier.
The bank attributed the improvements to higher trading and investment income, following record customer-related treasury income from increased retail bond sales and strong hedging demands.
Trading and liquidity management activities also registered a “robust performance”, the bank said.
Total allowances fell by 5.2 per cent to S$186 million for the quarter, following a 3.8 per cent drop in specific allowance on loans to S$158 million from S$164 million. General allowance, meanwhile, remained unchanged at S$28 million.
Total credit costs stood at 23 basis points (bps) for the quarter, down from 25 bps in the same period last year.
The bank’s non-performing loans ratio was 1.5 per cent, down from 1.6 per cent the same period last year. Non-performing assets coverage stood at 99 per cent, or 204 per cent after accounting for collateral.
The results translate to an annualised earnings per share of S$3.50 for the quarter, down slightly from S$3.54 recorded in Q1 2023.
Return on equity, excluding one-off expenses, stood at 14 per cent, down 0.9 percentage point on the year from 14.9 per cent, and up 0.2 percentage point on the quarter.
Shares of UOB : U11 0% closed at S$30.55 on Tuesday, down S$0.01 or 0.03 per cent.
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