United Overseas Bank has reported a 7% decline in fourth-quarter net profit to SGD 1.41 billion as shrinking margins offset growth in loans and record-breaking fee income.
United Overseas Bank, the third-largest lender in Southeast Asia by assets, announced on Tuesday that its fourth-quarter net profit fell by 7% compared to the previous year. The Singapore-based institution recorded a net profit of SGD 1.41 billion for the period spanning October to December, down from SGD 1.52 billion during the same timeframe a year prior. Despite this year-on-year decline, the bank comfortably exceeded the mean estimate of SGD 1.35 billion predicted by analysts. This performance represents a significant recovery from the third quarter, when profits plummeted by 72%, with the bank attributing the recent rebound to a reduction in credit costs.
The financial results for the full 2025 fiscal year highlight the challenges posed by a shifting interest rate environment. The bank’s net interest margin, which serves as a primary indicator of profitability, contracted to 1.89% from 2.03% in the preceding year. This compression led to a 3% dip in net interest income, which settled at SGD 9.36 billion. However, these headwinds were partially mitigated by a stellar performance in the bank’s fee-based divisions. Net fee income surged by 7% to reach a record high of SGD 2.6 billion, bolstered by robust activity in wealth management and loan-related services as consumer confidence remained resilient.
