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16-09-2022, 09:20 AM
UOB 's share had fallen again to $27.19 after US's two days of fall in Dow jones
July 29): United Overseas Bank Ltd struck an optimistic tone on Southeast Asia’s growth prospects even as aggressive rate hikes point to a gloomier global picture.
This comes as Southeast Asia’s third-largest lender’s net income rose 11% from a year earlier in the three months ended June 30, largely in line with analysts’ expectations. After rallying this month, its shares gave up early gains to drop as much as 3.3% on Friday, outpacing the dip in the benchmark stock index.
While UOB is getting a tailwind from higher interest rates, it is also confronting the risks of an economic slowdown triggered by moves to curb inflation. The Federal Reserve raised rates by another 75 basis points this week. In Singapore, its central bank again tightened policy in a surprise move, on the back of its economy flatlining in the second quarter.
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“We continue to see economic activity picking up as borders reopen and investment flows resume,” Chief Executive Officer Wee Ee Cheong said in a statement. He cited strong employment and buoyant consumer sentiment in Singapore, where institutional and private wealth inflows remain steady amid the country’s “safe haven” status.
Wee added that rising interest rates are expected to further boost its margins, with the lender expecting mid single-digit loan growth for this year.
“While the aggressive rate increases around the world are going to put a damper on global growth, we remain fairly optimistic of the resilience of our key markets in Southeast Asia,” said Wee, who said he doesn’t expect a recession in the bank’s key markets.
The bank is expected to write back provisions more slowly in the second half, as UOB may prefer to retain pandemic-related pre-emptive provisions amid increased uncertainties in the macro-environment, said Bloomberg Intelligence analysts Rena Kwok and Sheenu Gupta.
Regulatory approvals
The bank, which agreed to buy Citigroup Inc’s consumer businesses in Southeast Asia, said it expects to get regulatory approval for the deal in Thailand and Malaysia by year end. In Vietnam, it’s expected to receive approval by the first quarter of next year, and for Indonesia, by the fourth quarter of 2023.
Larger rivals DBS Group Holdings Ltd and Oversea-Chinese Banking Corp are due to report next week.
https://www.theedgemarkets.com/article/u...-headwinds
July 29): United Overseas Bank Ltd struck an optimistic tone on Southeast Asia’s growth prospects even as aggressive rate hikes point to a gloomier global picture.
This comes as Southeast Asia’s third-largest lender’s net income rose 11% from a year earlier in the three months ended June 30, largely in line with analysts’ expectations. After rallying this month, its shares gave up early gains to drop as much as 3.3% on Friday, outpacing the dip in the benchmark stock index.
While UOB is getting a tailwind from higher interest rates, it is also confronting the risks of an economic slowdown triggered by moves to curb inflation. The Federal Reserve raised rates by another 75 basis points this week. In Singapore, its central bank again tightened policy in a surprise move, on the back of its economy flatlining in the second quarter.
Sponsored Content
Malaysian companies forging sustainability-driven practices
For companies with sizeable environmental footprint, could financial incentives be offered in exchange for less emissions, consumption and waste?
Read More
“We continue to see economic activity picking up as borders reopen and investment flows resume,” Chief Executive Officer Wee Ee Cheong said in a statement. He cited strong employment and buoyant consumer sentiment in Singapore, where institutional and private wealth inflows remain steady amid the country’s “safe haven” status.
Wee added that rising interest rates are expected to further boost its margins, with the lender expecting mid single-digit loan growth for this year.
“While the aggressive rate increases around the world are going to put a damper on global growth, we remain fairly optimistic of the resilience of our key markets in Southeast Asia,” said Wee, who said he doesn’t expect a recession in the bank’s key markets.
The bank is expected to write back provisions more slowly in the second half, as UOB may prefer to retain pandemic-related pre-emptive provisions amid increased uncertainties in the macro-environment, said Bloomberg Intelligence analysts Rena Kwok and Sheenu Gupta.
Regulatory approvals
The bank, which agreed to buy Citigroup Inc’s consumer businesses in Southeast Asia, said it expects to get regulatory approval for the deal in Thailand and Malaysia by year end. In Vietnam, it’s expected to receive approval by the first quarter of next year, and for Indonesia, by the fourth quarter of 2023.
Larger rivals DBS Group Holdings Ltd and Oversea-Chinese Banking Corp are due to report next week.
https://www.theedgemarkets.com/article/u...-headwinds
