Oversea-Chinese Banking Corporation (O39) Q3 2025 earnings summary

Executive summary

• Q3 2025 net profit reached S$1.98 billion, up 9% quarter-on-quarter and flat year-over-year, marking the highest in five quarters and the second highest on record, driven by record non-interest income and robust wealth management and insurance contributions.

• Wealth management fees grew 53% year-over-year to a new quarterly high, with income up 25% quarter-on-quarter and AUM rising 18% year-over-year to S$336 billion.

• Trading and insurance income showed robust growth, with insurance profit contribution up 50% quarter-on-quarter and new business embedded value margin improving.

• Asset quality remained resilient, with NPL ratio stable at 0.9% for six consecutive quarters.

• Capital position is strong, with CET1 ratio at 16.9% transitional and 15% fully phased-in.

Financial highlights

• Total income for Q3 2025 rose 7% sequentially to S$3.80 billion, driven by record non-interest income, while net interest income declined 2% quarter-on-quarter and 9% year-over-year as NIM compressed to 1.84%.

• Non-interest income surged 24% quarter-on-quarter and 15% year-over-year to S$1.57 billion, led by fee, trading, and insurance income.

• Fee income reached S$683 million in Q3, up 18% quarter-on-quarter and 34% year-over-year.

• Operating expenses rose 3% year-over-year for the nine months; cost-to-income ratio held at 39.3%.

• Customer loans grew 7% year-over-year to S$327 billion; customer deposits up 11% year-over-year to S$411 billion, with CASA ratio rising to 50.3%.

Outlook and guidance

• Guidance for NIM revised to around 1.9% due to lower interest rates; loan growth expected to remain mid-single digits, with CIR at low 40s and credit costs around 20bps.

• Operating environment remains complex with slower global growth, shifting policy dynamics, and ongoing geopolitical and trade policy risks anticipated for 2026.

• Fundamentals remain resilient, with positive mid- to long-term growth prospects and opportunities in regional supply chain resilience, energy transition, and digitalisation.

• Commitment to 60% dividend payout ratio and completion of share buyback by end-2026 reaffirmed.