OCBC Q3 profit rises 3% to S$2.04 billion, slightly above expectations
However, non-interest income was down on the back of weaker investment performance by insurance arm Great Eastern.
OCBC's third quarter profit rose 3% to S$2.04 billion, exceeding expectations by a small margin. However, the non-interest income experienced a 10% decline, primarily due to weaker investment performance by its insurance arm, Great Eastern. Net interest income increased by 4% to S$2.31 billion, driven by growth in average assets, including both customer loans and high-quality non-commercial assets.
The net interest margin, however, decreased by 18 basis points to 1.66%, reflecting a more competitive interest rate environment. The bank's non-performing loans ratio fell to 0.8%, down from 0.9% in the same period last year. OCBC has raised its financial guidance for 2026, anticipating loan growth in the low double digits and total income growth of at least a mid-single digit percentage.
Credit costs are expected to be between 15 and 20 basis points, slightly lower than the previously anticipated 25 to 30 basis points. OCBC Group CEO Tan Teck Long anticipates global conditions to remain uncertain, influenced by geopolitical tensions, elevated inflation risks, and the easing of energy prices following the Middle East conflict. The bank also highlights the strong growth in AI and related technology sectors.
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