Brief Introduction:
United Overseas Bank Limited (SGX: U11), or UOB, is one of Asia’s leading financial institutions.
Headquartered in Singapore, the bank operates banking subsidiaries in China, Indonesia, Malaysia, Thailand, and Vietnam, supported by a global network of more than 470 offices across 19 markets spanning Asia Pacific, Europe, and North America.
While it maintains an international presence, UOB’s strategic focus remains on serving individuals and businesses within ASEAN, and facilitating cross-border connectivity across the region through a customer-centric approach that creates long-term value.
UOB is also recognised for its strong financial standing, with high credit ratings of Aa1 from Moody’s Investors Service, and AA- from both S&P Global Ratings and Fitch Ratings.
Financial Figures (2Q FY2025 vs. 2Q FY2026):
| 2Q FY2025 | 2Q FY2026 | % Variance | |
| – Net Interest Margin (S$’mil) | $2,336m | $2,297m | -1.7% |
| – Net Fee & Commission Income (S$’mil) | $636m | $665m | +4.6% |
| – Other Non-Interest Income (S$’mil) | $493m | $632m | +28.2% |
| Total Revenue (S$’mil) | $3,465m | $3,595m | +3.7% |
| Total Expenses (S$’mil) | $1,535m | $1,629m | +6.1% |
| Net Profit Attributable to Shareholders (S$’mil) | $1,338m | $1,478m | +10.5% |
After posting year-on-year declines in both total income and net profit for the past 3 consecutive quarters (from 3Q FY2025 to 1Q FY2026), the bank finally returned to growth this quarter, with total income rising by 3.7% and net profit increasing by 10.5%. In my opinion, this represents a reasonably good set of results.
Net interest income declined by 1.7% year on year, mainly due to a compression in net interest margin amid the prevailing interest rate environment. Net interest margin fell by 17 basis points to 1.74%, from 1.91% in the same period a year ago.
On a more positive note, net fee and commission income grew by 4.6% year on year, supported by strong growth in wealth and fund management activities. Other non-interest income also jumped by 28.2% year on year, boosted by non-recurring gains from asset divestments.
Meanwhile, total expenses increased by 6.1% year on year, largely due to continued investments in talent, technology, and strategic business initiatives.
Financial Figures (1H FY2025 vs. 1H FY2026):
| 1H FY2025 | 1H FY2026 | % Variance | |
| – Net Interest Margin (S$’mil) | $4,745m | $4,621m | -2.6% |
| – Net Fee & Commission Income (S$’mil) | $1,330m | $1,302m | -2.1% |
| – Other Non-Interest Income (S$’mil) | $1,047m | $1,094m | +4.5% |
| Total Revenue (S$’mil) | $7,121m | $7,017m | -1.5% |
| Total Expenses (S$’mil) | $3,094m | $3,152m | +1.9% |
| Net Profit Attributable to Shareholders (S$’mil) | $2,828m | $2,915m | +3.1% |
For the first half of FY2026, UOB reported a mixed set of financial results, with both net interest income and net fee and commission income registering year-on-year declines, while other non-interest income was the only segment to record growth, increasing by a mid-single-digit percentage. As a result, the bank’s total income declined by 1.5% year on year.
Net interest income fell by 2.6% year on year, mainly due to an 18 basis point compression in net interest margin, which declined from 1.96% a year ago to 1.78% amid the prevailing interest rate environment. However, the impact was partially cushioned by balance sheet optimisation and loan growth.
Net fee and commission income declined by 2.1% year on year, largely due to a high base in the previous year and softer investment banking fees. On a more positive note, wealth management fees recorded double-digit growth to reach a new half-year high, supported by sustained client engagement and strong demand for investment products.
Meanwhile, other non-interest income increased by 4.5% year on year, supported by non-recurring gains from asset divestments. Customer-related treasury income also reached a new high, driven by healthy hedging and investment demand from customers.
Key Financial Ratios (1Q FY2026 vs. 2Q FY2026):
| 1Q FY2026 | 2Q FY2026 | Difference (in Percentage Points – pp) | |
| Net Interest Margin (%) | 1.82% | 1.74% | -0.08pp |
| Return on Equity (%) | 11.5% | 11.7% ^^ | +0.2pp |
| Non-Performing Loans Ratio (%) | 1.5% | 1.6% | +0.1pp |
^^ – UOB did not disclose its return on equity for the 2nd quarter. The figure shown above was therefore derived based on the reported figures for the 1st quarter and first half of FY2026.
Net interest margin declined by 0.08pp to 1.74%, mainly due to asset yield compression amid the lower benchmark interest rate environment.
Meanwhile, the non-performing loan ratio edged up by 0.1pp to 1.6%, following a 9% quarter-on-quarter increase in non-performing assets from S$5.276 billion to S$5.750 billion. The increase was largely attributable to a single real estate account in Greater China.
Dividend Payout to Shareholders (1H FY2025 vs. 1H FY2026):
UOB pays dividends on a half-yearly basis and maintains a dividend payout ratio of 50% of its earnings.
Below is a comparison of the bank’s interim dividend for the first half of FY2026 against the corresponding period last year:
| 1H FY2025 | 1H FY2026 | % Variance | |
| Dividend Per Share (S$’cents) | 110.0 cents | 88.0 cents | -20.0% |
UOB declared an interim dividend of 88.0 cents per share, representing a payout ratio of approximately 50% of its net profit. The lower dividend payout can be attributed to the bank’s weaker performance in the 1st quarter, where net profit declined by 3.6% year on year.
For UOB shareholders, the following are the key dates to take note of for its upcoming dividend payout:
Ex-Date: 17 August 2026
Record Date: 18 August 2026
Payout Date: 28 August 2026
CEO Mr Wee Ee Cheong’s Comments & Outlook (from the Bank’s Press Release):
“Our results reflect the resilience of our diversified franchise, and the momentum building across our key ASEAN markets. Wealth management reached new highs, while transaction banking benefited from healthy customer activity across the region.
Our ASEAN strategy is gaining traction. We are seeing good progress across our businesses as we deepen customer relationships, expand our capabilities and connect customers to opportunities across our regional network.
Looking ahead, we see significant opportunities to grow wealth, support cross-border ambitions and capture a larger share of trade and investment flows across ASEAN. We are sharpening our focus and investing in capabilities that will drive long-term value for our customers and shareholders.”
Closing Thoughts:
Compared to the previous few quarters, where UOB had been reporting year-on-year declines in both total income and net profit since 3Q FY2025, the latest quarter was a much better one for the bank, with both financial figures returning to year-on-year growth.
The Singapore-headquartered bank also achieved several new highs in the first half of FY2026. Its wealth management fees reached a record half-year high, while customer-related treasury income also climbed to a new high, contributing to the 4.5% year-on-year increase in its other non-interest income.
On the dividend front, however, UOB’s interim dividend fell by 20% to 88.0 cents per share, bringing it back to the same level as its interim dividend payout in FY2024. This was largely within my expectations, given the weaker net profit recorded by the bank in the 1st quarter of FY2026.
Another area worth keeping an eye on is its asset quality, with the non-performing loan ratio edging up by 0.1pp from the previous quarter to 1.6%. The increase was largely attributable to a single real estate account in Greater China.
Looking ahead to UOB’s final dividend when it reports its full-year results in February 2027, unless the bank is able to sustain the year-on-year improvement in its financial performance in the 2nd half of FY2026, we could potentially see its total dividend payout to shareholders decline on a year-on-year basis for another year.
Related Documents:
Press Release
Financial Statements
CEO’s Presentation Slides
CFO’s Presentation Slides
Results Posted by the Other Singapore-Listed Banks:
DBS Group Holdings Limited (SGX: D05): 2Q & 1H FY2026 Results Review
Oversea-Chinese Banking Corporation Limited (SGX: O39): 2Q & 1H FY2026 Results Review
Disclaimer: At the time of writing, I am a shareholder of United Overseas Bank Limited.
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