OCBC posts record nine-month profit

OCBC posts record nine-month profit

Oversea-Chinese Banking Corporation (OCBC) posted a record net profit of S$6.24 billion for the first nine months of 2026, up 10% from a year earlier, as strong growth in wealth management and wholesale banking lifted the lender’s income.

For the third quarter, OCBC’s net profit rose 3% year-on-year to S$2.04 billion, despite a weaker contribution from Great Eastern Holdings (GEH), the bank’s insurance arm. The quarterly result was 8% below the record S$2.22 billion recorded in the second quarter.

OCBC said total income for the nine months reached a record S$11.73 billion, 7% higher than a year earlier. Non-interest income was a key driver, rising 19% to S$4.93 billion, with growth across fees, trading and insurance income.

Wealth management remained a major source of growth. Wealth management fees increased 25% to S$1.33 billion in the nine months, while banking wealth management assets under management rose to a record S$358 billion in the third quarter. Excluding GEH, banking wealth management income increased 2% quarter-on-quarter to S$1.12 billion.

Wholesale banking also contributed strongly. Non-interest income from the business rose 24% in the first nine months, while customer-flow trading income increased 40% to a record S$1.35 billion. OCBC said the increase reflected strong demand from wealth-related activities and corporate hedging.

Net interest income slightly lower

Net interest income, however, edged down 1% to S$6.80 billion in the nine-month period as the group operated in a lower interest-rate environment. Net interest margin fell to 1.71% from 1.93% a year earlier, although a 12% increase in average assets helped support interest income.

In the third quarter, net interest income increased 4% year-on-year to S$2.31 billion. OCBC said higher yields and loan growth supported the increase, although higher funding costs partly offset the benefit.

Banking operations performed particularly strongly in the quarter, with profit rising 8% from the previous quarter to a record S$1.90 billion. The bank attributed the performance to loan growth, customer-flow trading income and resilient fee income.

The weaker quarter-on-quarter group result was largely due to GEH. Its investment performance was affected by mark-to-market losses on bond holdings amid rising interest rates, while gains from its equity portfolio recorded in the second quarter were not repeated. GEH’s underlying insurance business remained resilient, with new business embedded value rising 14% year-on-year in the third quarter.

Asset quality remained strong. OCBC’s non-performing loan ratio improved to 0.8% at the end of September from 0.9% a year earlier and in June, while total non-performing asset coverage increased to 168%. Nine-month allowances fell 9% to S$424 million.

The bank’s balance sheet also expanded. Customer loans rose 14% year-on-year to S$372 billion, while customer deposits increased 12% to S$461 billion. OCBC’s Common Equity Tier 1 capital adequacy ratio stood at 15.5% under transitional final Basel III reforms and 14.0% on a fully phased-in basis.

Outlook remaines uncertain

OCBC said the outlook remained uncertain because of geopolitical tensions and inflation risks, while it continued to monitor conditions in Indonesia. At the same time, it pointed to continued growth in artificial intelligence and related technology sectors as an area of opportunity.

“Global conditions remain uncertain amid geopolitical tensions and elevated inflation risks,” Group CEO Tan Teck Long said, adding that the bank was positioned to navigate the uncertainty because of its capital, funding and liquidity strength, diversified income streams and risk management.