UPDATE: UOB posts 2Q21 net profit rose 43 percent on loan and wealth-management growth

UOB logoPhoto by Leslie Shaffer

This article was originally published on Wednesday, 4 August 2021 at 8:55 a.m. SGT; it has since been updated to include more details.  

UOB reported its second quarter net profit climbed 43 percent on-year to S$1.0 billion on robust loan growth and a higher net interest margin as well as strong growth in wealth management and other fees. The results beat a forecast from Daiwa.

“Our diversified customer franchise and investment in digital capabilities have enabled us to deliver another strong set of results,” Wee Ee Cheong, deputy chairman and CEO of UOB, said in a statement. “Our performance was underpinned by our proactive and focused support for our customers in their businesses and investments.”

Net interest income for the April-to-June quarter rose 8 percent on-year to S$1.58 billion on an 8 basis point increase in the net interest margin to 1.56 percent, the Singapore bank reported in a filing to SGX.

The net interest margin, or NIM, was at 1.56 basis points in the second quarter, compared with 1.48 basis points in the year-ago period and 1.57 basis points in the previous quarter, UOB said.

Net fee income for the quarter increased 34 percent on-year to S$595 million on strong growth in wealth management, loan-related and fund management fees, UOB reported.

Daiwa had forecast net profit of S$917 billion for the quarter on net interest income of S$1.54 billion and fee income of S$549 million.

First half results

For the first half, UOB reported net profit increased 29 percent on-year to S$2.01 billion on stronger business momentum and lower credit allowance.

The total allowance fell to S$383 million from S$682 million a year earlier for the six month period as asset quality was within expectations and on strong reserve coverage taken the previous year, UOB said.

Net interest income for the January-to-June period edged up 2 percent on-year to S$3.11 billion on healthy loan growth of 6 percent, which offset a 4 basis point decline in net interest margin, UOB said.

Net fee income for the six months rose 28 percent on-year to S$1.23 billion as wealth management fees reached record levels as investor confidence was buoyed by a market recovery, UOB said.

UOB declared an interim dividend of 60 Singapore cents a share.


CEO Wee issued an upbeat outlook.

“Our robust balance sheet and strong capital and liquidity positions also enable us to support our customers in capturing new opportunities arising from the growth momentum in Greater China and developed markets. We are accelerating our digital agenda to provide progressive solutions in anticipation of their business and personal financial needs,” Wee said.

“With countries speeding up their vaccination drive, we are optimistic that the situation will gradually pick up in Southeast Asia,” he added, noting the bank was working with governments to support pandemic-affected customers, especially small- and medium-sized businesses.

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