Oversea-Chinese Banking Corporation (OCBC Bank) has achieved a net profit after tax of SGD1.23 billion for the first quarter of 2019 that ended on March 31.
This was 11 percent above SGD1.11 billion reported a year ago and up 33 percent from SGD926 million in the previous quarter.
In a press statement, the bank noted that this was driven by strong income growth across the Group’s banking, wealth management and insurance franchise.
Net interest income grew to a new high of SGD1.53 billion, an 8 percent increase from SGD1.42 billion last year. This was lifted by healthy asset growth and a rise in net interest margin (NIM).
Meanwhile, customer loans climbed 5 percent to SGD259 billion, from SGD247 billion a year ago, driven by broad-based growth across key markets. NIM rose 9 basis points to 1.76 percent, mainly from higher asset yields in a rising interest rate environment and an increase in gapping income from money market placements.
OCBC Group’s overall wealth management-related income rose 27 percent from a year ago to SGD921 million and represented 34 percent of the Group’s total income. This income includes that from insurance, private banking, asset management, stockbroking and other wealth management products.
Compared to the last quarter of 2018, OCBC's net profit was 33 percent higher. This was driven by strong income growth, cost discipline and increased contributions from associates. Net interest income grew 1 percent quarter-on-quarter as a result of asset growth and a 4 basis points increase in NIM, driven largely by loan repricing in Singapore.
On the other hand, non-interest income was up 38 percent, lifted by higher fees and commissions, net trading income and profit from life insurance. Operating expenses were well-controlled and rose 2 percent from a quarter ago, while allowances for loans and other assets were 22 percent higher.
“Our strong first quarter 2019 results demonstrated the underlying strength of the Group’s banking, wealth management and insurance franchise which drove our operating profit to a new high," said OCBC CEO Samuel Tsien.
"We will continue to stay watchful of the progress of trade negotiations between the United States and China, developments in financial markets and conclusion of a number of elections in the region," he added.