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Joelton
Supreme |
30-May-2026 13:37
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OCBC stays &lsquo buy&rsquo on CLAS after &lsquo opportunistic divestment&rsquo of 336-key Clarke Quay hotel OCBC Group Research analyst Ada Lim is staying &ldquo buy&rdquo on CapitaLand Ascott Trust (CLAS) with an unchanged fair value estimate of 95 cents after its &ldquo opportunistic divestment&rdquo of The Robertson House by The Crest Collection in Singapore for $360 million, announced on May 29. The sale price of the proposed divestment to an unrelated third party is a 4.0% premium to an independent valuation of $346 million as at end-2025, according to CLAS. CLAS has declined to reveal the identity of the buyer. The sale price of the 336-unit hotel translates to an exit Ebitda yield of 2.3%, and CLAS will recognise a net gain of some $38.1 million from net proceeds of $341.7 million. The transaction is expected to be completed in 3Q2026. On a pro forma basis, had the divestment been completed on Jan 1, 2025, FY2025 distribution per stapled security (DPS) would have been 3.1% lower at 5.91 cents, while net asset value (NAV) per stapled security would remain unchanged at 1.17 Singapore cents. CLAS says net proceeds from the divestment may be deployed for investment in higher-yielding assets, to fund asset enhancement initiatives (AEIs), to repay higher-interest debt, and/or for general corporate purposes. &ldquo The divestment of The Robertson House by The Crest Collection at an attractive price of close to $1.1 million per key underscores CLAS&rsquo s disciplined approach to portfolio reconstitution,&rdquo says Serena Teo, CEO of the managers. Formerly the Riverside Hotel Robertson Quay, the hotel was rebranded as The Robertson House by The Crest Collection in October 2023 after a seven-month refurbishment. The hotel&rsquo s all-day dining restaurant Entrepô t is the first project by chef Nixon Low, who joined Ascott as its culinary and beverage operations director in May 2023 from the Tung Lok Group. Post-divestment, CLAS will have four lodging properties in Singapore. Three properties &mdash Ascott Orchard Singapore, lyf one-north Singapore and lyf Funan Singapore &mdash are operational. The fourth property, Somerset Clarke Quay Singapore, is currently under redevelopment. Formerly Somerset Liang Court Singapore, the 192-unit serviced residence with a hotel licence is on track to complete around end-2026 and is expected to begin contributing income progressively from early 2027, according to CLAS. Somerset Clarke Quay Singapore will form part of the CanningHill Piers integrated development, alongside the 475-key Moxy Singapore Clarke Quay (owned by CDL Hospitality Trusts) and the 696-unit joint residential development by CapitaLand Development and City Developments. In addition to the redevelopment of Somerset Clarke Quay Singapore, CLAS has four properties undergoing AEIs in 2026 and 2027. These properties are Citadines Place d&rsquo Italie Paris in France, The Cavendish London in the UK, Sotetsu Grand Fresa Osaka-Namba in Japan, and Sheraton Tribeca New York Hotel in the US. CLAS says the AEIs will enhance the assets&rsquo positioning to better capture lodging demand and uplift their value. CLAS is Asia-Pacific&rsquo s largest lodging trust, with 106 hotels, serviced residences, rental housing and student accommodation across 45 cities in 16 countries as at March 31. Singapore remains a key market for CLAS, says OCBC&rsquo s Lim in her May 29 report. &ldquo Barring a significant deterioration in the macroeconomic outlook, in part due to the Middle East conflict, we remain constructive on the Singapore hospitality sector, which we think will be supported by growing international arrivals and tourist receipts.&rdquo Accounting for the divestment, Lim trims her FY2026 and FY2027 DPS projections by 0.1% each. Lim likes CLAS&rsquo s exposure to the living sector &mdash including student accommodation in the US and rental housing in Japan &mdash where demand is &ldquo less likely to be affected by any weakening in the global macroeconomic outlook&rdquo . &ldquo We also see CLAS&rsquo s ongoing portfolio rejuvenation as a positive for long-term growth and sustainability.&rdquo CLAS offers a total returns potential of 13%, according to Lim, based on its May 28 close price of 89.5 cents. CLAS stapled securities closed flat at 90 cents on May 29 following the announcement, but are down some 6.8% year to date. |
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hokpin
Supreme |
25-May-2026 10:47
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All, OCBC keeps breaking all time high. No idea when to upsize my holding. Having happy problem now...
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Checkerman
Master |
22-May-2026 12:46
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$28-30 potential
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hokpin
Supreme |
22-May-2026 11:47
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只 有 更 高 ， 没 有 最 高 ！ | ||||||||||
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Joelton
Supreme |
21-May-2026 10:10
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OCBC outbids banks on HSBC Indonesia deal by wide margin: sources The higher offer allows OCBC to enter bilateral negotiations to finalise the deal [SINGAPORE] OCBC substantially outbid rivals in a recent deal to buy HSBC Holdings&rsquo s retail and wealth assets in Indonesia, by more than US$100 million in most cases, according to people familiar with the matter. Only the second-highest bid was within US$100 million of OCBC&rsquo s, the people said, asking not to be identified because the information is private. The higher offer allowed OCBC to enter bilateral negotiations to finalise the deal, the people said. Representatives for OCBC and HSBC declined to comment. OCBC agreed to acquire the HSBC assets earlier this month to deepen its presence in South-east Asia&rsquo s largest economy. The price of the transaction was calculated based on the net asset value of HSBC Indonesia&rsquo s International Wealth and Premier Banking operations and a premium of up to about S$480 million, OCBC said. The difference between OCBC&rsquo s offer and others hasn&rsquo t previously been reported. The value is subject to adjustments and will be finalised after the deal is completed, potentially in the first half of next year, pending regulatory approvals, OCBC said. The amount was decided on a &ldquo willing-buyer, willing-seller basis,&rdquo taking into account business prospects and potential synergies, according to the bank. Other shortlisted bidders included Singaporean lenders DBS and UOB, Malaysia&rsquo s CIMB Group Holdings and Japan&rsquo s Sumitomo Mitsui Financial Group, people familiar with the matter have said Fast-growing markets such as Indonesia have attracted banks looking to expand. OCBC has a presence in Indonesia with its Jakarta-listed subsidiary Bank OCBC NISP Tbk, and it has grown in the country both organically and via acquisitions, including buying Commonwealth Bank of Australia&rsquo s local unit in 2024. The HSBC purchase will be the first by new OCBC chief executive officer Tan Teck Long, who is planning a deeper push into Asia, including in the affluent segment in Hong Kong and expanding private banking in Indonesia. As part of the deal, OCBC will offer to employ all 1,300 staff working in HSBC Indonesia&rsquo s retail banking operations, the bank said. Analysts have so far reacted positively to the rationale of the deal. Bloomberg Intelligence analysts Sarah Jane Mahmud and Alison Hor said it will boost OCBC&rsquo s South-east Asian franchise and strengthen profit margins and fees. It &ldquo should be modestly earnings accretive, excluding one-time integration costs,&rdquo they wrote. Tan has said the HSBC Indonesia assets are &ldquo a perfect fit&rdquo for OCBC&rsquo s Indonesia strategy, and the total portfolio of S$6.6 billion will also accelerate the bank&rsquo s growing wealth business. The HSBC portfolio had deposits of S$2.3 billion and a much smaller S$300 million customer retail loan book. BLOOMBERG |
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hokpin
Supreme |
19-May-2026 15:28
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ATH SGD 23.3+ today together with Big Bro DBS! | ||||||||||
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chartiskao
Elite |
14-May-2026 14:13
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The current meeting between Donald Trump and Xi Jinping (May 14&ndash 15, 2026) is acting as a major catalyst for Singapore&rsquo s financial sector, specifically OCBC (Oversea-Chinese Banking Corporation). As capital flees the Middle East due to the ongoing Iran conflict, OCBC is positioned to benefit from its dual role as a " Safe Haven" and a " Wealth Management Powerhouse."
The following report analyzes why these factors are pushing OCBC shares toward and potentially beyond the SGD 22.90 mark. Report: Geopolitical Convergence and OCBC Share Catalysts1. Features (The " What" )
2. Touchpoints (Interaction Channels)
3. Gainpoints (Drivers for Share Price Appreciation)
4. Painpoints (Investor Concerns)
5. Challenges & Solutions
Export to Sheets
Executive Summary for InvestorsThe convergence of the Trump-Xi summit (which lowers the regional risk floor) and the Iran conflict (which drives capital into Singapore) creates a " perfect storm" for OCBC. As Middle Eastern investors seek a neutral, sophisticated, and stable financial harbor, OCBC' s wealth management and corporate banking divisions are seeing unprecedented demand. This influx of liquidity is the primary engine fueling the rise toward the SGD 22.9 price target.
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Joelton
Supreme |
12-May-2026 09:52
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OCBC, UOB, DBS lead Singapore stocks higher on Monday STI up 0.4% Across the broader market, losers outpace gainers 340 to 279, as 2.1 billion securities worth S$2.6 billion change hands [SINGAPORE] Singapore stocks ended higher on Monday (May 11), with the benchmark Straits Times Index (STI) rising 0.4 per cent or 20.87 points to 4,942.77. OCBC : O39 +2.65% led the gainers on the blue-chip index, advancing 2.6 per cent or S$0.58 to S$22.50. The other two local banks also closed higher. DBS : D05 +0.15% gained 0.2 per cent or S$0.09 to finish at S$58.77, and UOB : U11 +1.18% was up 1.2 per cent or S$0.43 at S$36.99. The worst performer among the STI constituents was Seatrium : 5E2 -3.04%, which fell 3 per cent or S$0.07 to S$2.23. Within the iEdge Singapore Next 50 Index, Riverstone : AP4 +7.19% was the top gainer with a 7.2 per cent or S$0.055 rise to S$0.82. Meanwhile, China Aviation Oil : G92 -5.71% was the biggest loser, declining 5.7 per cent or S$0.12 to end the session at S$1.98. Across the broader market, losers outpaced gainers 340 to 279, after 2.1 billion securities worth S$2.6 billion changed hands. Key regional indices were mixed. Hong Kong&rsquo s Hang Seng Index gained 0.1 per cent, Japan&rsquo s Nikkei 225 fell 0.5 per cent, South Korea&rsquo s Kospi was up 4.3 per cent, and the FTSE Bursa Malaysia KLCI declined 0.2 per cent. &ldquo Markets continue to prioritise AI-driven earnings optimism over escalating geopolitical risks, reinforcing the strength of the current momentum trade,&rdquo said Stephen Innes, SPI Asset Management managing partner. He added: &ldquo The longer the Strait of Hormuz remains unstable, the greater the risk that energy markets eventually force a repricing across equities, bonds and currencies simultaneously.&rdquo |
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Joelton
Supreme |
12-May-2026 09:49
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OCBC consumer banking chief Sunny Quek aims to double wealth business by 2029 The lender&rsquo s new wealth management committee could hold the key to a successful execution of its &lsquo Next Frontier&rsquo pivot [SINGAPORE] OCBC head of global consumer financial services Sunny Quek has big ambitions. After doubling the lender&rsquo s consumer banking wealth business since he stepped into his current role in 2022, he is ready to do it again &ndash this time from a bigger base. &ldquo I&rsquo m going to double this business again by 2029,&rdquo he said in an exclusive interview with The Business Times. &ldquo My original target was to double our wealth business by 2030. Now, I think we can do it faster.&rdquo It is a bold statement to make, in a market filled with similar promises. But as a 30-year veteran of the banking industry, Quek knows the odds. He has spent 14 years at OCBC, where he has seen three group chief executives come and go. He has lived through the usual cycles of grand banking strategies and corporate reshuffles. Yet, he strongly believes the bank has finally found the right tool to force actual change: its newly minted wealth management committee. &ldquo My confidence comes from the experience I&rsquo ve had in the last four months with the wealth management committee,&rdquo he said. &ldquo I can feel the difference.&rdquo The wealth management committee took shape at the start of 2026. It is the main engine powering new group chief executive Tan Teck Long&rsquo s &ldquo Next Frontier&rdquo strategy, as the bank pivots towards a &ldquo whole-of-wealth&rdquo model. Tan designed the committee to tear down historic walls dividing the consumer bank, private wealth arm, and insurance unit. It compels OCBC&rsquo s consumer banking head to sit at the same table with the CEOs of Bank of Singapore and Great Eastern. The central mandate forces these divisions to operate under shared financial targets. It ensures they stop fighting over the same lucrative clients and start pooling their resources to lock in regional assets. Tan chairs the group, and having the chief executive in the room means everyone faces real consequences if they fail to align. Structural advantage Quek acknowledged, however, that almost every financial institution has drawn up similar playbooks. &ldquo All of us have a wealth strategy. What&rsquo s really going to differentiate one bank from another is the execution,&rdquo he said. And OCBC has a clear structural advantage in Singapore: it owns an insurance company. &ldquo No other Singapore bank has that,&rdquo Quek said. &ldquo An insurer&rsquo s CEO does not sit in a committee with other banking heads they are not part of that value chain. For us, however, whatever is built by any of the three of us is built for the whole group.&rdquo This means the bank pulls all three entities together under unified leadership, unlike its peers, Quek said. If they can get the banking app to talk seamlessly to the insurance database without duplicating costs, they might just have a winning formula. But Quek will have his work cut out for him &ndash the base he intends to double is already massive. The bank&rsquo s full-year performance for 2025 also laid down a formidable bedrock of wealth momentum. Lifted by income growth across the wealth continuum, group wealth management income soared 14 per cent to a record S$5.6 billion in 2025. This lucrative segment now represents 38 per cent of the group&rsquo s entire income, which rose a record S$14.6 billion. A key driver was wealth management fees. These surged 33 per cent to an all-time high, and drove a 22 per cent increase in total net fee income to S$2.4 billion. The bank scooped up more assets, and rode on positive market valuation to push its banking wealth assets under management (AUM) up 15 per cent to S$343 billion. Digital channels saw even sharper spikes during the year. Digital wealth revenue in the city-state surged by over 80 per cent. Even gold and silver are glittering brighter, with precious metals revenue rocketing more than eight times year on year. Regional push The hunger for wealth extends well beyond Singapore&rsquo s borders. The city-state&rsquo s offshore wealth fees grew more than 30 per cent. Hong Kong, the other half of OCBC&rsquo s &ldquo twin hubs&rdquo strategy, grew its Premier Banking customers by more than 30 per cent offshore customers there expanded by over 40 per cent. In Malaysia, wealth fees grew more than 10 per cent, accompanied by a near 15 per cent rise in new affluent customers. To service this regional influx, the bank plans to hire close to 250 relationship managers in Singapore and Hong Kong. Not content with organic growth, the bank is also making a grab for scale in South-east Asia&rsquo s largest economy. On May 4, it announced that its Indonesian subsidiary had agreed to acquire the retail banking and wealth management operations of Bank HSBC Indonesia, in a deal which instantly injected 336,000 customers into the OCBC Indonesia franchise. It brings across S$6.6 billion in AUM. This sizeable chunk of wealth includes S$4.3 billion in customer investments in mutual funds, bonds and insurance, along with S$2.3 billion in deposits. When completed in the second quarter of 2027, the move will boost OCBC Indonesia&rsquo s AUM by 25 per cent and add about 1,300 staff to its talent pool. It firmly anchors the bank&rsquo s ambitions in a critical regional market. Momentum is certainly building for this overarching strategy. The traction was clearly visible in OCBC&rsquo s Q1 financial results released on May 8. This was the first quarter since the wealth management committee convened and Tan&rsquo s Next Frontier strategy was put in place. The lender posted a 5 per cent rise in net profit to S$2 billion for the three months ended Mar 31, neatly beating market estimates. While a lower interest rate environment dragged net interest income down by 5 per cent to S$2.2 billion, wealth management was the undeniable hero of the quarter as record-high non-interest income plugged the gap. Wealth fees in Q1 surged 34 per cent to S$422 million, driven by robust customer activity across all channels. Overall wealth management income climbed 11 per cent to S$1.5 billion, representing 39 per cent of the group&rsquo s total income. The chief executive explicitly called out this wealth-led performance as crucial support against geopolitical tensions and inflation risks. Shifting attitudes OCBC&rsquo s pivot comes amid shifting consumer attitudes towards wealth. As digital platforms democratise market access, younger consumers expect to start their investment journeys earlier, with far less capital. &ldquo Consumers don&rsquo t think about their life goals holistically,&rdquo Quek said. &ldquo You often hear: &lsquo I&rsquo m too poor to think about retirement&rsquo ... &ldquo What we are seeing globally, not just in Singapore, is the growing need for better financial literacy, earlier retirement planning, and much more structured wealth advice across different life stages,&rdquo he added. &ldquo These trends are reshaping how we think about wealth management.&rdquo The bank is adapting its tools to capture this new generation. Its mobile app now offers fractional investment solutions to sharply lower the barrier to entry. Customers can start small with products such as the Blue Chip Investment Plan, RoboInvest, unit trusts and even fractions of precious metals down to 0.1 grams of gold. The goal is to hook customers early and use the new committee structure to seamlessly pass them up the wealth chain as their assets grow. While digital channels provide the volume, Quek stresses that managing significant wealth remains deeply rooted in trust and human advice. To execute its ambitious plans on the ground, OCBC is heavily equipping its relationship managers with advanced tools. The bank recently rolled out an artificial intelligence training programme for its wealth advisors, and the early results underscore Quek&rsquo s confidence about execution. Advisers who completed the programme booked twice as many client appointments as their peers. Their monthly revenues jumped 50 per cent from that in the three months prior to the training. Indeed, changing entrenched corporate culture and erasing silo mentalities take significant time and are a massive undertaking. With a firm hand from the top, a clear road map for South-east Asia, and a fresh war chest of Indonesian assets, OCBC is laying the groundwork. But while the mandate to double the consumer wealth business by 2029 sets a high bar, Quek sees a clear path forward. And if his infectious confidence spreads, that ambitious target could be well within reach. |
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Echoes
Senior |
12-May-2026 09:35
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Whether to sell or hold is purely up to the individual - to each his own . I started buying in 2011 at $7+ all the way to $17+ last year , and have not sold a single share . My average is around $10.40 . During the AGM , the Chairman mentioned that there were 4th generation shareholers who inherited the shares and were present for the meeting . Yes , the shares has been passed down for 4 generations . I intend to pass mine to my children . As for total shareholder returns , I did a rough calculation , it takes around 13 years for the dividens to fully pay up for your share . And during the same period , the share price would have doubled . In other words , if you sink in $1 , you take back $3 after 13 years . The returns may seem to be peanuts if you were to compare to many other growth stocks , but if you were to consider the fact that its a mature and safe business , plus it rewards you with good dividens regularly , its still a pretty good investment . This is the first time that I have not added any since the massive runup over the past 6 months . Until I can see that the profits and dividens can justify its current lofty price , only then I will add more . Meanwhile , I will just sit back and enjoy my coffee . |
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MrBear12
Supreme |
12-May-2026 09:28
Yells: "Cast all our anxieties on Jesus for He cares for us" |
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the real question is do you need the money? as in do you need cash to buy a house or to buy guns?
you will probably not get a average buy price of 11:40 ever again, unless a global recession comes by.
So like me, just hold on. My rationale is simple, will OCBC ever fall below 8:00 again?
highly unlikely... ...
so HOLD.
Bear heard OCBC wants to double its wealth management business.
We shld consider buying,,, not selling!
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LimBanLim
Member |
12-May-2026 00:33
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I have more than 50 lots at an average price of $11.40. The question is should I sell now? | ||||||||||
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MrBear12
Supreme |
11-May-2026 22:47
Yells: "Cast all our anxieties on Jesus for He cares for us" |
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total shareholder return for this ocbc is gonna be attractive as it chases DBS.
currently, it's the bank with most potential cause of its acquisitions and wealth management.
and do remember it is still the oldest bank.
it is the mainstay of overseas Chinese banking.
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Echoes
Senior |
11-May-2026 21:56
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I attended their AGM and based on what has transpired a special dividen of 10% profits ( approx 16 cts ) is more or less a given for FY 26 . We already collect special dividens of 16 cts for FY 24 and FY 25 so it will be 3 years in a row should that take place . Thereafter , the dividens will revert back to 50% profits , for FY 27 . Unless profits increases dramatically , OCBC' s ordinary dividens are around 84 cts and if you include the special , its around $1 . At todays closing price of $22.50 , the yield is not particularly attractive compared to its yesteryears . My last purchase was at $17+ and I have not added any since . But , I have not sold any either , and I have owned this stock for more than 15 years . DYODD .
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taulauhor
Member |
11-May-2026 18:57
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$25 coming. Now it is already $23 taking the latest dividend into consideration.
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MrBear12
Supreme |
10-May-2026 21:01
Yells: "Cast all our anxieties on Jesus for He cares for us" |
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https://www.theedgesingapore.com/capital/banking-finance/ocbc-open-returning-share-buyback-portion-800-mil-special-dividends-hsbc
more special dividends coming our way??? possible!
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Joelton
Supreme |
09-May-2026 09:49
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OCBC&rsquo s hidden treasure Treasury actually. Can OCBC&rsquo s Treasury & Markets be scaled to deliver consistent double-digit growth in total income and further boost total shareholder returns? OCBC&rsquo s relatively new group CEO Tan Teck Long&rsquo s dividend policy is to maintain a 50% payout ratio as analysts clamour for more share buybacks. The higher the net profit, the higher the absolute dividends, and OCBC&rsquo s long-term shareholders prefer dividends. Let&rsquo s take a step back and focus on dividends from growth. On Feb 25, Tan introduced the Next Frontier Strategy with four important Shifts. In the Franchise Shift, available in OCBC&rsquo s 2025 Annual Report, one of the strategies is to grow OCBC&rsquo s private bank in Indonesia. To that end, OCBC&rsquo s has announced the acquisition of HSBC&rsquo s International Wealth and Premier Bank in Indonesia. Another franchise shift refers to deepening the twin hubs of Singapore and Hong Kong. The plan is to scale Global Markets in Hong Kong. Prior to joining OCBC, Tan was chief risk officer at DBS, and a member of the executive committee. He had been at DBS for 28 years and had a ringside seat to some of the changes DBS had experienced, including the setting up of its Corporate Treasury Function, and its digital shift in 2015 and 2016 following the failed attempt of the acquisition of PT Bank Danamon. In Tan&rsquo s Next Frontier, for the tech shift, he has ADD at the core, that is, AI, Digital, Data. The strategy is to embed customer centricity powered by ADD and pursue tech sectors. With a customer-centric strategy, the right customer will be delivered the right product at the right time. The shifts cut across OCBC&rsquo s consumer, wholesale, global markets, wealth management and the group&rsquo s other segments building on its One Group approach. Recall that DBS&rsquo s treasury business is an important cog in the wheel of its horizontal customer journeys. The Treasury & Markets (T& M) segment cuts across DBS horizontally - through consumer, wholesale and wealth. In FY2025 DBS reported $2.14 billion of treasury customer sales, and in 1Q2026, DBS clocked in $592 million of treasury customer sales, more than double the $269 million in 1Q2023. Banks&rsquo treasury products are used for both the banks&rsquo own treasury departments and their customers' needs. These comprise products for risk management, liquidity, investment yield, foreign exchange, interest rate hedging (ad infiniturm). The products range from offering customers investment solutions for the most simple to the most complex products for all kinds of financial assets but generally fixed income, interest rates, equities, exchange rates, and in some instances, commodities. During OCBC&rsquo s results briefing on May 8, Tan was asked about his plans for a treasury sales strategy at OCBC. &ldquo The Treasury business is a very important business for us. You have to think about Treasury business in two parts even though it' s described as trading income in our accounting terms. One part is trading. The second part is more important to us, which is trying to grow the customer flows with treasury products. This is the part where we are building up talent. If you look carefully at the quarterly results, the customer flow has been rising. To continue to sustain and grow, we have onboarded some talent, mainly in different product categories and sales. Product capability will help to drive the growth of the front-facing business, in particular the wealth business, because wealth is all about structuring products for sale,&rdquo he describes. &ldquo In our twin hub strategy in the Next Frontier strategy, we spell out that we want to scale up Treasury in Hong Kong, because Hong Kong is a wealth hub,&rdquo Tan adds. The OCBC CEO declines to give growth numbers but over time, treasury could turn out to be a growth engine to watch as increasingly sophisticated products form part of OCBC&rsquo s wealth continuum. Technically, the Straits Times Index didn&rsquo t move much during the week of May 3-8, gaining nine points week-on-week. ADX has fallen to 13, reflective of the STI&rsquo s sideways range. Quarterly momentum remains in a declining mode. 21-day RSI is moving sideways. The weight of the indicators suggests that the STI could ease mildly. Support appears at 4,700. Resistance has been established at 5,040. The uncertainty in the market&rsquo s blue-chip segment reflects investors&rsquo and market participants&rsquo reaction to the banks&rsquo results. Over and above what analysts have recommended, investors and market participants are weighing their decisions on whether they should or shouldn&rsquo t agree with the analysts. |
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Joelton
Supreme |
09-May-2026 09:48
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OCBC&rsquo s Indonesia deal a &lsquo perfect fit&rsquo for Asean wealth ambitions, says CEO, as Q1 profit beats estimates Lender&rsquo s earnings for period rise 5% to S$1.97 billion [SINGAPORE] OCBC&rsquo s acquisition of HSBC&rsquo s wealth and retail portfolio in Indonesia is a &ldquo perfect fit&rdquo for the lender&rsquo s refreshed growth road map, group CEO Tan Teck Long said on Friday (May 8). This comes as strong wealth income helped drive a robust first-quarter earnings performance. &ldquo If you recall, under our &lsquo Next Frontier&rsquo strategy, we said that we are focused on growing wealth, as well as deepening our franchise in our core markets,&rdquo said Tan at the bank&rsquo s earnings briefing. &ldquo When I looked at (HSBC&rsquo s) portfolio, I realised this (acquisition) is a perfect fit,&rdquo he added. The move included doubling down on the bank&rsquo s wealth proposition and sharpening its focus on core Asean markets, which includes Indonesia. At an earlier briefing in February, Tan also flagged that the lender was exploring merger and acquisition opportunities in the region. That ambition has since materialised. Earlier this week, on Monday, OCBC announced that its Indonesian subsidiary, Bank OCBC NISP, would acquire HSBC&rsquo s retail and wealth management operations in Indonesia. The consideration will comprise the Indonesian business&rsquo net asset value upon completion, plus a premium of up to 6.5 trillion rupiah (S$475.5 million). The deal is expected to close in the second quarter of 2027. The acquisition is expected to contribute to earnings and add S$6.6 billion to OCBC Indonesia&rsquo s assets under management. This figure includes S$4.3 billion of customers&rsquo investments in mutual funds and bonds, as well as insurance and customer deposits of S$2.3 billion. A retail loan book of S$300 million and about 336,000 customers will also be transferred to OCBC Indonesia. Around 1,300 employees are expected to join its wealth management operations. Tan described the HSBC portfolio as &ldquo very clean&rdquo , noting that it is largely made up of deposits and assets under management, unlike &ldquo most other&rdquo portfolios in the market that tend to comprise a mix of loans and deposits. Acquiring a portfolio without a significant loan component means the bank does not need to &ldquo worry about&rdquo credit costs or single-borrower concentration risks, he said. &ldquo What I really like when I look at the deposits part of the acquisition (is that) they have sizeable Casa,&rdquo he added, referring to current account and savings account deposits, which provide banks with low-cost funding. Tan also described the wealth portion of the portfolio as &ldquo highly complementary&rdquo to OCBC&rsquo s existing Indonesian franchise. &ldquo We are one of the top three privately owned banks in Indonesia... we can bolt on this acquisition and gain cost synergies very quickly. Not many banks can match our economies of scale in Indonesia,&rdquo he said. To support its wealth ambitions, OCBC will continue expanding its sales-related wealth headcount, although the bank intends to &ldquo maintain high cost discipline&rdquo at the group level. Asked about competition in both mergers and acquisitions and wealth hiring &ndash after reports that DBS and UOB had also bid for the HSBC portfolio and separately spoken about growing their wealth teams &ndash Tan said competition was not new to OCBC. Still, he noted that the exit of several international players from Asean in recent years has resulted in a less crowded competitive landscape across the region. Wealth income offsets margin pressure On Friday, OCBC reported a 5 per cent rise in net profit for the first quarter ended Mar 31 to S$1.97 billion, from S$1.88 billion a year earlier. The result exceeded the S$1.88 billion consensus estimate in a Bloomberg survey. Net interest income fell 5 per cent to S$2.2 billion amid a lower interest rate environment, as net interest margin narrowed by 28 basis points to 1.76 per cent, from 2.04 per cent previously. This came as benchmark rates in Singapore and Hong Kong declined by more than 170 and 160 basis points year on year, respectively. However, the weakness was more than offset by non-interest income, which rose 23 per cent to a record S$1.61 billion. Under that bucket, wealth management fees climbed 34 per cent to S$422 million, supported by stronger customer activity across all wealth product channels. The non-performing loan ratio was unchanged at 0.9 per cent. Total allowances rose 2 per cent to S$216 million, largely due to higher provisions for &ldquo third-order&rdquo effects from the ongoing Middle East war. These were mainly linked to risks of a macroeconomic slowdown arising from elevated oil and energy prices. &ldquo We note no significant credit deterioration, and continue to refresh our stress tests,&rdquo said group chief financial officer Goh Chin Yee at the briefing. &ldquo (The) first-order impact is not material, at less than 3 per cent of loans or 1 per cent of total assets.&rdquo Tan added that operations in Dubai &ndash where OCBC&rsquo s private banking arm, Bank of Singapore, runs a booking centre &ndash have not been affected. Staff there continue to work remotely, including the 10 to 20 per cent of employees who voluntarily chose to leave the country after the outbreak of the war. The bank maintained its FY2026 guidance, including expectations for total income to remain &ldquo stable to growing&rdquo , along with a &ldquo slight to moderate&rdquo decline in full-year net interest income. The latter outlook assumes one US Federal Reserve rate cut in the fourth quarter of 2026, as well as benchmark Singapore and Hong Kong interest rates of 1.2 per cent and 2.7 per cent per annum, respectively. OCBC maintained its expectations for mid-single-digit loan growth, credit costs of 25 to 30 basis points, and a cost-to-income ratio in the mid-40 per cent range. In the first quarter, loans grew 8 per cent year on year to S$347 billion. Credit costs improved by one basis point to 23 basis points, while the cost-to-income ratio rose to 39.3 per cent from 38.7 per cent previously. OCBC rounded off the first-quarter earnings season for Singapore&rsquo s three local banks, following DBS on Apr 30 and UOB on Thursday. Shares of OCBC : O39 +0.09% were up 0.1 per cent or S$0.03 at S$21.91 as at 2.49 pm on Friday, the same day the bank paid out dividends. The counter has gained 10.4 per cent year to date. |
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Joelton
Supreme |
08-May-2026 10:03
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OCBC Q1 profit rises 5% to S$1.97 billion, beats estimates Non-interest income rose 23% to a record S$1.61 billion [SINGAPORE] OCBC&rsquo s net profit for the first quarter rose 5 per cent, driven by strong growth in wealth management, the lender said on Friday (May 8). Net profit for the three months ended Mar 31, 2026 stood at S$1.97 billion, versus S$1.88 billion a year earlier. This was above the S$1.88 billion consensus estimate in a Bloomberg survey of five analysts. Net interest income fell 5 per cent to S$2.2 billion, amid a lower interest rate environment, as net interest margin narrowed by 28 basis points to 1.76 per cent, from 2.04 per cent previously. Non-interest income rose 23 per cent to a record S$1.61 billion, as wealth management fees increased by 34 per cent to S$422 million, with contributions across all wealth product channels on increased customer activities. The non-performing loan ratio was unchanged at 0.9 per cent. Total allowances rose 2 per cent to S$216 million, largely due to higher allowances for non-impaired assets. Tan Teck Long, group chief executive officer of OCBC, said: &ldquo We achieved a new high for non-interest income, led by our wealth business, which helped us offset lower net interest income amid a low-interest rate environment.&rdquo OCBC rounded off the first-quarter earnings season for Singapore&rsquo s three local banks, following DBS on Apr 30 and UOB on May 7. Earlier this week, on May 4, OCBC announced that its subsidiary, Bank OCBC NISP Tbk, will acquire the assets and liabilities of HSBC&rsquo s retail and wealth management operations in Indonesia. Shares of OCBC : O39 -0.55% closed 0.6 per cent, or S$0.12, lower at S$21.88 on Thursday, ahead of the results release. |
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SDEXXXXD
Veteran |
08-May-2026 07:15
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Great news plus dividend credit into bank later today. | ||||||||||
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