You are here

UOB's Q4 profit up 0.3% from a year ago, full-year down 1.2%

Tuesday, February 16, 2016 - 08:18
1.jpg
The UOB Group reported on Tuesday net earnings of S$788 million for the fourth quarter ended Dec 31, 2015, up 0.3 per cent compared to S$786 million a year ago.

THE UOB Group reported on Tuesday net earnings of S$788 million for the fourth quarter ended Dec 31, 2015, up 0.3 per cent compared to S$786 million a year ago.

During the quarter, the bank had incurred one-off expenses of S$43 million for the UOB80 commemorative events and brand campaign. Total income increased 12.5 per cent to reach S$2.08 billion on the back of strong core income and gains from the sale of investment securities.

Net-interest income grew 9.3 per cent to S$1.28 billion, led by a 10 basis-point increase in net interest margin to 1.79 per cent.

Non-interest income rose 17.9 per cent from a year ago to S$803 million. Fee and commission income grew 6.7 per cent to S$480 million, with increases recorded across most fee businesses. Trading and investment income surged 64.3 per cent to S$263 million mainly from higher trading income.

Excluding the one-off expenses in Q4, total expenses increased 14.4 per cent from a year ago.

Total allowances were S$190 million during the quarter, 14.6 per cent higher than a year ago. Specific allowances on loans increased 58.1 per cent to S$115 million mainly due to non-performing accounts in Singapore, Indonesia and Greater China.

Compared to the preceding quarter, UOB's net profit has fallen 8.1 per cent due to lower gains from the sale of investment securities and the higher one-off expenses incurred in Q4.

For the full year 2015, UOB generated net earnings of S$3.21 billion, 1.2 per cent lower from a year ago which included a higher write-back of tax provisions. Total income grew 7.9 per cent to reach S$8.05 billion, led by a broad-based increase in core income and higher gains on sale of investment securities. Net interest income grew 8.1 per cent to S$4.93 billion, driven by healthy loan growth and improved net interest margin.

Group non-performing loan (NPL) ratio remained stable at 1.4 per cent on Dec 31, while NPL coverage was 130.5 per cent and 315.7 per cent after taking collateral into account. Its Common Equity Tier 1 and Total CAR stood at 13 per cent and 15.6 per cent, respectively.

Looking ahead, Wee Ee Cheong, UOB's deputy chairman and chief executive officer, said the financial markets would continue to grapple with volatility and uncertainty in 2016 due to concerns over the impact of falling oil prices and China's slowdown on the global economy.

"Our view is that the risks are largely manageable and the underlying economic fundamentals are strong enough to withstand the shocks even as we enter an environment of slower growth."

The board has recommended a final dividend of 35 cents per share. Together with the interim dividend of 35 cents and the one-off 80th anniversary dividend of 20 cents, the total dividend for 2015 amounts to 90 cents per share.

Powered by GET.comGetCom