OVERSEA-Chinese Banking Corp, Singapore's third biggest bank, said its quarterly profit rose 22 per cent, beating expectations, and unveiled a $221 million charge to account for losses from the credit market turmoil. The bank reported net profit of $463 million for the July-September period, up from $379 million a year ago and against an average forecast of $417 million by five analysts polled by Reuters.
Global credit and equity markets experienced sharp falls in the third quarter after defaults in US subprime mortgage market spread, drying up liquidity in credit markets, hammering valuations of financial securities and causing hefty losses in bank earnings across the globe.
The bank also booked at writeback for loans and properties in the quarter, taking its total net allowance to $39 million.
Last month, No 2 United Overseas Bank, posted a below-expected 8.2 per cent rise in quarterly profit as trading and investment income was hit by US credit turmoil.
DBS Group, Southeast Asia's biggest lender by assets, posted a better-than-expected 11 per cent rise in quarterly profit on strong loan and fee growth, despite taking a small hit from the credit turmoil.
Shares of OCBC and DBS were hit in the third quarter by the global credit squeeze.
OCBC dropped 2.7 per cent, DBS fell 5.3 per cent, while UOB, which has benefited from Singapore's property boom, rose 0.5 per cent in the quarter. All lagged a 4.5 per cent gain in the benchmark Straits Times index. -- REUTERS
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