Friday 29 Mar 2024
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SINGAPORE (July 31): Singapore's No.2 lender Oversea-Chinese Banking Corp beat expectations with a jump to record quarterly profit, but smaller rival United Overseas Bank saw income decline to its weakest in seven quarters.

Analysts are worried about the earnings outlook for the sector after Singapore's economy contracted in April-June and prices of private homes dropped for a seventh straight quarter, hurting growth in mortgages.

While bigger rival DBS Group Holdings last week warned of some uncertainty in the second half, OCBC sounded more upbeat.

"We continue to be positive on the underlying prospects in our key markets," OCBC CEO Samuel Tsien said in a statement.

OCBC's net profit came in at S$1.05 billion ($740 million) in the three months ended June, up 14 percent from the same period a year ago and 8 percent higher than an average forecast from seven analysts polled by Reuters.

Helped by its recent acquisition of a Hong Kong-based lender, it saw an 18 percent surge in loans, outpacing 9 percent growth for DBS and a climb of 4.8 percent for UOB.

Hit by lower trading income, UOB's net profit fell 5.7 percent to S$762 million, below an average forecast of S$819 million from five analysts polled by Reuters.

Last week DBS, Singapore's biggest bank, posted a better-than-expected 15 percent rise in second-quarter net profit, helped by higher interest rate margins.

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