OCBC posted a net profit of S$2.04 billion for the third quarter of 2026, up about 3% from S$1.98 billion a year earlier, the bank reported on Friday (Nov 6). The result came in a little above the S$2.0 billion Bloomberg consensus estimate, while profit was 8% lower than the record set in the second quarter.
For the first nine months of the year, group net profit reached a record S$6.24 billion, an increase of 10% on the same period in 2025.
Banking arm at record, insurance weaker
Net profit from banking operations hit a record S$1.90 billion in the quarter, up 16% year on year and 8% from the previous quarter. Group earnings were held back by weaker investment performance at insurance unit Great Eastern Holdings.
Net interest income rose 4% year on year to S$2.31 billion, its highest in six quarters, supported by a 15% rise in average assets. Net interest margin narrowed to 1.66%, down 18 basis points from a year ago and 4 basis points from the second quarter. According to Investing.com, margins were squeezed by higher US rates, partly offset by higher Singapore rates.
Non-interest income fell 10% year on year to S$1.42 billion. Net fee income grew 8% to S$735 million, with wealth management fees of S$442 million, the second-highest on record. Customer flow trading income reached a record S$480 million. However, net trading and investment income dropped 33% quarter on quarter to S$465 million, mainly due to mark-to-market losses on Great Eastern’s bond holdings, and insurance income fell 48% from the prior quarter to S$198 million.
Loans up, credit costs down
Customer loans rose 14% year on year in constant currency terms to S$372 billion as at Sept 30, while customer deposits grew 12% to S$461 billion. Total allowances fell 63% year on year to S$52 million, and the non-performing loan ratio improved to 0.8% from 0.9% at the end of June. Operating expenses were flat at S$1.52 billion, giving a cost-to-income ratio of 40.8%.
Chief executive Tan Teck Long flagged continued uncertainty in global economic conditions amid geopolitical tensions and high inflation, Investing.com reported.
Guidance upgraded
The bank raised several parts of its full-year 2026 outlook. It now expects loan growth in the low double digits and total income growth of at least a mid-single-digit percentage. Net interest income is now expected to be flat to slightly lower, compared with an earlier forecast of a slight decline, and credit cost guidance was cut to 15 to 20 basis points from 20 to 25 basis points. The cost-to-income ratio target was kept in the low-40% range.
OCBC kept its 50% ordinary dividend payout ratio and its S$2.5 billion capital return plan, which it aims to complete by the end of 2026. No dividend was declared for the quarter, in line with its half-yearly schedule. The final ordinary dividend for 2026, and any special dividend, will be announced with fourth-quarter results.
