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OCBC Bank reported an 11% decline in net income in the fourth quarter as a result of lower earnings in the bank's insurance arm, Great Eastern Holdings (GEH), the bank's results said Friday. For the full year, net income increased, revenue growth, tight cost control and reduced provisions boosted the Group's banking results.
Net profit fell to S $ 926 million for the fourth quarter, from S $ 1.0 billion last year, due to a drop in GEH profits. At the same time, after-tax net profit of the group's banking business grew 22 percent to $ 817 million, the group said.
Net interest income for the fourth quarter increased 7 percent from $ 1.4 billion in the same period last year to $ 1.5 billion in Singapore, driven by growth in loans and loans. higher net interest margin (NIM). The NIM for the quarter increased by five basis points to 1.72%.
Earnings per share for the quarter were less than $ 0.24 a year ago, at $ 0.22 in Singapore.
Fourth quarter net trading income declined to A $ 9 million from $ 99 million a year earlier, primarily due to unrealized mark-to-market losses in GEH's investment portfolio. because of "adverse market conditions," said OCBC. Excluding GEH, the current operating income of the group's banking activities increased by 5% year-on-year.
The bank proposed a final dividend of 23 cents Singapore per share, an increase of 21 percent from 19 cents Singapore a year earlier. If we add the dividend interim dividend of 20 cents Singapore per share, the total dividend for the 2018 fiscal year stands at 43 cents Singapore per common share, which represents an increase of 16% compared to the previous year.
Net income up over the full year, supported by the banking sector
Net income for the full year of 2018 increased by 11%, from $ 4.0 billion to $ 4.5 billion, up 11%. This increase is driven by the group's banking activities, which grew by 22%. The performance of banking operations has increased significantly thanks to revenue growth, tight cost control and lower provisions, OCBC said.
For the year as a whole, net interest income increased by 9% over last year to reach S $ 5.9 billion, thanks to the growth of loans and loans. on the rise of the NIM. The NIM for the full year improved 5 basis points to 1.70%, compared to higher margins in Singapore, Malaysia and Greater China.
Non-interest income was down 7% from a year ago, mainly due to lower investment income from GEH, the bank said. Net operating income, down 1% from the previous year, stood at S $ 508 million, while personal insurance and property and casualty income showed a slight 911 million pesos.
For the year, operating expenses increased by 4% over the previous year to reach 4.2 billion Singapore dollars.
Earnings per share reached US $ 1.06, compared with US $ 0.95 a year earlier.
Samuel Tsien, President and CEO of OCBC, commented on the results and said that the group's results reflect the "strength and resilience" of the bank's diversified business and the depth of its relationships with clients.
Tsien said global economic growth is expected to slow down in the future, given concerns over continued trade and geopolitical tensions, sluggish markets and investments, and growing political risks in advanced economies. .
The group said it will work on its focused strategy, strong capital and financing, and disciplined cost control to continue to prudently expand its franchise into key markets and provide support to its customers.
Shares of OCBC sold 1.82% after trading for a few hours on Friday morning, down $ 0.21 from the US at $ 11.36.
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