UOB’s FY25 Audit: A 200-Basis Point Spread in a Season of "Vanishing Customers" |🦖EP1446 I have been watching the local bank earnings reports roll in over the last week and something clicked for me regarding UOB that I felt compelled to share with our community of 6,000+ subscribers. While the mainstream headlines are busy celebrating a record fee income of $2.6 billion, I spent my evening digging into the footnotes of the wholesale credit provisions. There is a clear gap between the glossy narrative of a victory lap and the hard math of a 23 percent profit plunge. It feels like a celebration. But here is the uncomfortable truth: that attractive dividend is currently sitting on an engine showing signs of stress. When we look at the yield spread, we see a risk premium of only 86 basis point
UOB Drops 4% on Profit Decline! Can OCBC Buck the Trend?
UOB’s Q4 net profit fell 7% to S$1.41B, missing estimates, as lower rates compressed margins. FY2025 profit dropped 23% to S$4.7B, partly due to nearly S$1B in provisions. The bank trimmed its 2026 fee growth outlook to high single digits amid macro uncertainty. Yet across its four core Asean markets (Indonesia, Malaysia, Thailand, Vietnam), total income rose 5%, outperforming the group’s 3% decline. Management remains upbeat on intra-regional trade resilience despite fresh US tariffs. Prolonged margin pressure in a lower-rate cycle? What to focus for OCBC?
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