Oversea-Chinese Banking Corp (OCBC) reported on Tuesday a 22 percent jump in its third-quarter profit to S$463 million from S$379 million a year ago. Net interest income for the three months ended September 30 was S$565 million, up from S$473 million, while non-interest income rose to S$481 million from S$357 million.
The bank also unveiled a S$221 million (US$$152 million) charge to account for losses from the credit market turmoil.
The writedown was specifically for S$270 million in asset-backed securities collateralised debt obligations (CDO), out of a CDO portfolio of S$641 million.
OCBC said it stopped using counterparty quotes to value its ABS CDOs in the third quarter as the "ABS CDO market has come to a virtual standstill."
Instead, it used a third-party valuation model to estimate the fair value of the securities.
The bank's corporate CDO portfolio of S$372 million continues to be marked-to-market based on counterparty quotes.
As of September 30, the fair value of corporate CDOs was S$357 million.
At midday on Tuesday, OCBC shares were traded up 5 cents at S$8.90. - CNA/ch
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