Thursday, 6 October 2022

UOB’s FY21 net profit up 40% to $2.97 billion

5 min read

 ASEAN-focused UOB Group has reported total income of SGD 9.79 billion ($7.27 billion) and net profit of SGD 4.07 billion ($3 billion) for the financial year ended 31 December 2021 (FY21). Against the backdrop of an improving operating environment and a healthy growth in business activities and consumer spending, the Group saw strong performance across customer segments and geographies for the year.

In FY21, the Group’s fee income reached a new high of SGD 2.41 billion ($1.79 billion) on the back of stellar performance in wealth and loan-related activities. Net interest margin was stable at 1.56% amid a low interest rate environment and with proactive balance sheet management. Asset quality remained resilient with the non-performing loan (NPL) ratio steady at 1.6%. Group wholesale banking income rose 8% to SGD 4.39 billion ($3.26 billion), on the back of improved business sentiment as the Group’s strong client franchise drove robust loan and fee growth from large corporate and institutional clients. Cross-border income grew 10%, with business activities picking up towards the end of the year as clients increasingly tapped the Group’s regional connectivity capabilities.

Group Retail’s income was sustained at SGD 4.11 billion ($3.05 billion), as the strong recovery in wealth management and credit card activities helped to offset the impact of thinner margins. In particular, assets under management from high affluent customers reached a new record of SGD 139 billion ($103.2 billion), with 57% coming from overseas customers served by the Group’s network of wealth management centres in Southeast Asia. The Group’s recent acquisition of Citigroup’s consumer business in Indonesia, Malaysia, Thailand and Vietnam will accelerate its efforts to improve profitability through an expanded customer base and by unlocking business synergies.

In FY21, the Group made significant progress on its sustainability strategy. In addition to achieving operational carbon neutrality, the Group rolled out several well-received sustainable financing solutions with the total sustainable financing portfolio reaching SGD 17 billion ($12.63 billion) in FY21, well ahead of its 2023 target of SGD 15 billion ($11.14 billion). The Group has set a new sustainable financing portfolio target of SGD 30 billion ($22.29 billion) by 2025. In the area of sustainable investing, the Group’s total assets under management in environmental, social and governance-focused investments grew to SGD 9 billion ($6.68billion) during the year.

The Board recommends the payment of a final dividend of 60 cents per ordinary share. Together with the interim dividend of 60 cents per ordinary share, the total dividend for FY21 will be SGD 1.20 ($0.89) per ordinary share, representing a payout ratio of approximately 49%.

CEO Statement
Wee Ee Cheong, UOB’s deputy chairman and CEO said, “As we enter the third year of the global pandemic, the overall operating environment has stabilised. We achieved a healthy 40% increase in net profit for FY21 as economic growth, business activities and consumer sentiment picked up".

“We believe the worst is behind us. In Singapore, there are signs of market recovery where we see strong institutional loan growth and a rebound in card spending and wealth management activities. We see significant upside in Southeast Asia, though the pace of recovery may vary by country. Our confidence in the region is underscored by our continued efforts to deepen our customer franchise and to build scale, through organic growth and acquisition," he said.

“The opportunity to acquire Citigroup’s consumer business in Indonesia, Malaysia, Thailand and Vietnam came at the right time, with the right strategic fit. Subject to regulatory approval, the acquisition will double our retail customer base across these four markets. At the same time, we continue to invest in capabilities such as supply chain, sustainability and digitalisation to tap the structural trends propelling our region’s growth. Our strong balance sheet, disciplined business approach and resilient asset quality will position us well for new opportunities as we ride on the region’s recovery.”

Re-disseminated by The Asian Banker

Diary of Activities
Finance Thailand 2022
10 November 2022
Finance Indonesia 2022
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