UOB Group (UOB) has posted SGD 906 million ($654.9 million) in net profit for the first quarter of 2022 (1Q22), down 11% quarter on quarter (QoQ), amid market volatilities. The group’s core business drivers remained strong, with higher net interest income due to quality loan growth and disciplined pricing.
Total fees were flat QoQ. Loan-related fees hit a new high with 14% growth QoQ, but were offset by a decline in credit card, wealth management and fund management fees, which were affected by market sentiment. Trading and investment income saw a double-digit drop from short-term impact on hedges as interest rates rose. As a result, total income dropped slightly by 3% to SGD 2.4 billion ($1.73 billion).
Credit costs in 1Q22 normalised to 19 basis points given the higher general allowance write-back in the previous quarter. The group’s asset quality and balance sheet stayed resilient with adequate level of liquidity. The common equity tier 1 (CET1) ratio remained healthy at 13.1%.
Wee Ee Cheong, deputy chairman and CEO of UOB said, “Geopolitical tensions and uncertainties on the global growth outlook have led to market volatilities. Despite that, our core businesses held up well, with quality loans growth, record loan-related fees and better margins. We remain focused on supporting businesses to help them seize opportunities as borders reopen. The trade and investment corridors between ASEAN and China place us in a unique position to serve customers. The current disruptions to global supply chains will shore up the importance of the role of our region".
“We are making good progress in our Citi integration and our digital initiatives. Our own green efforts and support for our customers to make positive impact are seeing results. We aim to announce our net zero plans by the end of this year. We remain optimistic of the recovery of our region and the longer-term potential of Southeast Asia. With our strong balance sheet, backed by healthy capital and liquidity positions, we are well positioned to navigate these uncertain times together with our customers and the community,” Cheong said.
Re-disseminated by The Asian Banker