Oversea-Chinese Banking Corporation (O39) Q1 2025 TU earnings summary

Executive summary

• Net profit for Q1 2025 was S$1.88 billion, up 12% quarter-on-quarter but down 5% year-on-year from a record high.

• Resilient performance across banking, wealth management, and insurance segments, with broad-based growth in fee, trading, and insurance income.

• Cost-to-income ratio improved to 38.7% as expenses declined 9% sequentially.

• Asset quality remained robust, with prudent allowances set aside for non-impaired assets amid macroeconomic uncertainties.

• Business remains well-diversified across regions and segments, supporting balanced earnings.

Financial highlights

• Total income rose 7% quarter-on-quarter and 1% year-on-year to S$3.66 billion.

• Net interest income fell 4% quarter-on-quarter and year-on-year due to declining interest rates and NIM compression.

• Non-interest income surged 36% quarter-on-quarter and 10% year-on-year, led by wealth management, trading, and insurance.

• Operating expenses fell 9% sequentially to S$1.42 billion; cost-to-income ratio at 38.7%.

• EPS (annualised) was S$1.68; ROE (annualised) at 13.0%.

Outlook and guidance

• Financial targets maintained: NIM around 2%, mid-single-digit loan growth, cost-to-income ratio in low 40s, credit costs 20–25bps.

• 60% total dividend payout ratio, with share buybacks and special dividends as part of S$2.5b capital return over two years.

• Management expects heightened uncertainties from trade policy shifts and geopolitical risks to dampen regional economic growth.