OCBC reported a 9 percent fall in net earnings for the fourth quarter of 2020, while its full year net profit was 26 percent lower than the year before.
OCBC's quarterly earnings grew 10 percent to S$1.13 billion ($860 million) for the fourth quarter of 2020 – the third consecutive rise in quarterly earnings, though down 9 percent from the fourth quarter of 2019, according to its financial results published on Thursday morning.
The bank's full year 2020 net profit, which at S$3.59 billion was 26 percent lower than 2019's record earnings, was attributed to a sharp drop in market interest rates and higher expected credit loss allowances amid the Covid-19 pandemic.
At the same time, the bank showed growth in its wealth management business, citing record high wealth management fee income of S$250 million and assets under management reaching $121 billion.
Recovery Signs
The bank said it is entering 2021 with «cautious optimism,» noting a gradual improvement in consumer sentiment and business confidence. It also said it is well-positioned and looking to capitalize on signs of sectorial recovery.
«While economic conditions have started to show signs of stabilisation and we are seeing increased activities in some pockets of the economy, the recovery is not yet broad-based,» said CEO Samuel Tsien, who will be making way for Helen Wong come April, after nine years in the role.
Opportunities on the Horizon
Among the opportunities the bank sees are increased investment, trade and wealth flows in Asean, new connectivity along the Asean-China corridor, supply chain transformation, as well as green and renewables financing.
The bank's increase in technology spend in 2020 will continue into 2021, and it will continue to upskill and reskill its employees, OCBC said.
OCBC proposed a final dividend of 15.9 cents per share, bringing the total dividend for FY20 to 31.8 cents. The scrip dividend scheme will be applied.
