Singapore banks OCBC, UOB post higher Q2 profit on stronger fee income

Singaporean banks OCBC and UOB have posted robust second-quarter earnings, exceeding analyst expectations and signaling resilience in the financial sector. Both institutions saw their profits climb, largely fueled by a surge in non-interest income, particularly from fees.

Oversea-Chinese Banking Corp (OCBC) announced a significant 22% jump in its second-quarter net profit, reaching a record S$2.22 billion (US$1.73 billion). This strong performance prompted the bank to revise its 2026 loan growth forecast upward, now anticipating high-single-digit to low-double-digit expansion, a notable increase from its previous mid-single-digit projection. Despite slight pressure on net interest income, overall total income is expected to grow.

OCBC's CEO, Tan Teck Long, highlighted the bank's strong capital, funding, and liquidity positions as key buffers against global uncertainties, including the Middle East conflict and evolving energy markets. The bank maintained its commitment to a 50% ordinary dividend payout ratio and its S$2.5 billion capital return plan by the end of 2026.

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We are seeing good progress across our businesses as we deepen customer relationships, expand our capabilities and connect customers to opportunities across our regional network.

Meanwhile, UOB, Singapore's smaller peer, reported a 10% increase in its second-quarter net profit, reaching S$1.5 billion. This growth was significantly supported by record wealth management fees, demonstrating the bank's successful ASEAN strategy gaining traction. UOB CEO Wee Ee Cheong noted healthy customer activity across the region contributing to gains in wealth management and transaction banking.

These positive results follow a similar trend seen in larger peer DBS Group, which also reported a record 9% rise in its second-quarter net profit. The collective strong performance underscores the banks' ability to navigate interest-rate pressures and leverage diverse income streams to offset narrowing lending margins.

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The bank's strong capital, funding and liquidity position would support growth while providing a buffer against uncertainty.