UOB Profit Falls From Higher Allowances, Lower Interest Margin
After a record performance in 2024, Singapore-based UOB saw its profit fall last year due to pre-emptive allowances and lower interest margin.
UOB’s net profit in 2025 fell 23 percent year-on-year to S$4.7 billion ($3.7 billion), according to the bank’s financial results. The bank attributed the drop to pre-emptive general allowances proactively set aside in the third quarter of 2024 and a 0.14 percentage point decrease in net interest margin to 1.89 percent.
Total income was S$13.8 billion, down 3 percent, as lower net interest income and other non-interest income more than offset higher fee income. Total expenses dipped 2 percent to around S$6.2 billion. Total allowances more than doubled to over S$2 billion as the bank sought to strengthen provision coverage for selected markets and sectors amid growing macroeconomic uncertainties.
2026 Outlook
According to its presentation, UOB has a positive outlook for 2026, forecasting low single-digit loan growth and net interest margin of 1.75 to 1.85 percent for the full year, alongside high single-digit fee growth. The bank also expects low single-digit operating cost growth and credit costs totalling 25 to 30 basis points.
«ASEAN’s growth trajectory remains intact, powered by structural trends, including digitalization, infrastructure investments and deepening regional integration. In this environment, we are seeing steady momentum across our business lines, driven by our regional network and deepening customer relationships across ASEAN,» commented UOB deputy chairman and CEO Wee Ee Cheong.
«We will continue to strengthen regional connectivity, enhance wealth platforms and scale our digital capabilities to deliver more value for customers. With a robust balance sheet and an expanded regional franchise, we are well placed to support customers through cycles and seize new opportunities.»
