United Overseas Bank (U11) H2 2025 earnings summary

Executive summary

• Full-year 2025 net profit was SGD 4.7 billion, down 23% year-over-year, impacted by lower net interest margin and pre-emptive provisioning.

• Operating profit reached SGD 7.7 billion, down 4% year-over-year, supported by strong fee momentum in wholesale and retail banking.

• Fee income hit a record SGD 2.6 billion, up 7% year-over-year, driven by wealth and loan-related fees.

• Board recommended a final dividend of SGD 0.71 per share, total full-year dividend SGD 1.56 per share, plus a special dividend of SGD 0.50 per share.

• Diversified business model, strong ASEAN strategy, and continued focus on digitalization and capital return supported performance amid global uncertainties.

Financial highlights

• Net interest margin for FY25 was 1.89%, with net interest income down 3% year-over-year to SGD 9.4 billion.

• Fee income grew 7% to a record SGD 2.6 billion; gross fee income SGD 3.5 billion.

• Total expenses fell 2% year-over-year; cost-to-income ratio at 44.6%.

• NPL ratio stable at 1.5%; NPA coverage at 97% (254% with collateral).

• CET1 ratio at 15.1%, LCR at 147%, NSFR at 116%, indicating strong capital and liquidity positions.

Outlook and guidance

• 2026 guidance: low single-digit loan growth, full-year NIM of 1.75%-1.8%, high single-digit fee growth, low single-digit operating cost growth, total credit cost of 25-30 basis points.

• ASEAN growth remains robust, with focus on digitalization, infrastructure, and regional integration.

• Fee income growth revised down to high single digits due to more conservative loan growth outlook.

• Interest rates expected to stabilize, with potential for one rate cut.