Singapore's United Overseas Bank (UOB) said on Tuesday that its third-quarter net profit rose 8.2 percent from a year ago, boosted by a growth in lending and income from fees and commission.
Earnings came in at S$501 million from S$463 million in the same period last year, the company said in a statement to the stock exchange. Revenue for the three months to September was S$1.1 billion, up an annual 8.4 percent. Net interest income grew 4.4 percent to S$714 million as lending expanded, while non-interest income increased 16.5 percent to S$393 million.
Compared with the second quarter, net profit fell 14.3 percent.
"The decrease was mainly due to lower trading and investment income resulting from mark-to-market losses from widening credit spreads triggered by the US sub-prime crisis," the bank said.
UOB said none of the S$388 million in collateralised debt obligations (CDOs) it holds as investment is in default.
For the September quarter, the bank said it set aside another S$20 million worth of provisions against its CDO investments, raising the total provision to S$55 million.
In addition, UOB made another S$46 million in provision for mark-to-market losses against its reserves.
"We are pleased with the results achieved. Despite uncertainties in the financial market, our core business remains strong," said the UOB Group's deputy chairman and chief executive Wee Ee Cheong. "The market is undergoing a volatile period but the impact of the credit volatility on our core business has been minimal."
Last Friday, rival DBS Group Holdings, Southeast Asia's biggest bank, said its third-quarter net profit rose an annual 11 percent to S$610 million as lending expanded due to a strong economy.
Fees earned from stockbroking, investment banking, loan syndication and wealth management also contributed to the earnings, DBS said. - AFP/ir
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