Brief Overview:

Oversea-Chinese Banking Corporation Limited (SGX: O39), or OCBC, was established in 1912 following the merger of three local banks, making it Singapore’s longest-standing bank. It is currently the second-largest financial services group in Southeast Asia by assets.

OCBC is headquartered in Singapore and operates a banking network with nearly 400 branches and representative offices across 19 countries and regions. Its primary markets include Singapore, Malaysia, Indonesia, and Greater China, where it offers a wide range of commercial banking, specialist financial, and wealth management services.

In addition to its strong credit ratings (Aa1 from Moody’s and AA- from Fitch and S&P), OCBC is consistently ranked among the World’s Top 50 Safest Banks by Global Finance and has been recognised as Singapore’s Best Managed Bank by The Asian Banker.

Financial Figures (1Q FY2025 vs. 1Q FY2026):

	1Q FY2025	1Q FY2026	% Gain/Loss
– Net Interest Income (S$’mil)	$2,345m	$2,222m	-5.2%
– Net Fee & Commission Income (S$’mil)	$546m	$675m	+23.6%
– Other Non-Interest Income (S$’mil)	$764m	$931m	+21.9%
Total Income (S$’mil)	$3,655m	$3,828m	+4.7%
Total Expenses (S$’mil)	$1,415m	$1,505m	+6.4%
Net Profit (S$’mil)	$1,883m	$1,974m	+4.8%

OCBC’s 1Q FY2026 results were notably resilient. While its net interest income declined year on year (within expectations given the current low interest rate environment; however, this was partly offset by lower deposit costs and asset growth), the bank’s other 2 reportable business segments performed strongly, with net fee and commission income and other non-interest income both rising more than 20% year on year.

Non-interest income, which combines net fee and commission income with other non-interest income, reached a record S$1,606 million, contributing to a new high in total income of S$3,828 million for the bank.

Breaking it down, net fee and commission income grew 23.6% year on year to S$675 million, driven primarily by a 34% increase in wealth management fees as customer activity surged across all wealth product channels. Investment banking, trade-related, and loan-related fees also rose compared with a year ago.

Other non-interest income climbed 21.9% year on year to S$931 million, supported by a 10% increase in net trading income, largely from a 35% jump in customer flow income due to strong wealth-related activity and corporate hedging demand, and a 34% rise in income from life and general insurance, reflecting robust insurance performance and a release of reserves underpinned by positive experience and strong fundamentals.

Total expenses increased 6.4% year on year to S$1,505 million, mainly due to higher staff costs to support business expansion and ongoing IT investments.

Key Financial Ratios (4Q FY2025 vs. 1Q FY2026):

	4Q FY2025	1Q FY2026	Difference (in Percentage Points – pp)
Net Interest Margin (%)	1.86%	1.76%	-0.1pp
Return on Equity (%)	11.6%	13.0%	+1.4pp
Non-Performing Loans Ratio (%)	0.9%	0.9%	–

Among the 3 key financial ratios, the most notable was a 1.4 percentage point increase in return on equity compared with the previous quarter.

Non-performing assets declined 3.8% quarter on quarter, from S$3,243 million in 4Q FY2025 to S$3,120 million in 1Q FY2026, while the non-performing loans ratio held steady at 0.9% – the lowest among the 3 Singapore-listed banks, compared with 1.0% for DBS and 1.5% for UOB.

CEO Mr Tan Teck Long’s Comments & Outlook (from the Bank’s Press Release):

“We delivered a good start to 2026, with Group net profit rising 5% year-on-year to S$1.97 billion, underpinned by resilient performance across Banking, Wealth Management and Insurance as we execute our Next Frontier strategy. 

We achieved a new high for non-interest income, led by our wealth business, which helped us offset lower net interest income amid a low-interest rate environment. Our wealth fees grew 34% year-on-year to hit S$422 million. 

Even as we sustained our loan growth at 9% year-on-year, asset quality remained sound, underscoring the resilience of our portfolio amid a more challenging macroeconomic climate. 

Against this backdrop, we continued to make disciplined strategic investments to strengthen our long-term growth engines. The acquisition of HSBC’s wealth business in Indonesia fits well into our Next Frontier strategy under the Franchise Shift of building up our wealth business in Indonesia. It is a high-quality portfolio with significant assets under management (AUM), including deposits with sizeable CASA balances. The portfolio is highly complementary to our existing Indonesia franchise, with clear synergies across customers and capabilities. 

Looking ahead, global conditions remain uncertain amid geopolitical tensions and elevated inflation risks. Much of the near-term outlook will depend on how the war in the Middle East, with its impact on energy supply and prices, evolves, while the ongoing trade tariff situation is also being closely monitored. 

With our strong capital, funding and liquidity position, diversified income streams and disciplined risk management, we are well positioned to navigate uncertainties and deliver sustainable long-term value.”

Closing Thoughts:

OCBC delivered a very resilient set of results, reaching new highs in several areas, including non-interest income (with customer flow income hitting a record for the quarter), and total income.

Year-on-year growth was also strong, with both net fee and commission income and other non-interest income rising more than 20%.

Quarter on quarter, return on equity improved by 1.4 percentage points to 13.0%.

Looking ahead, if OCBC sustains this growth, investors are likely to see a year-on-year increase in the interim dividend payout, given the bank’s 50% dividend payout ratio.

Results of the Other Singapore-Listed Banks:

DBS Group Holdings Limited (SGX: D05): 1Q FY2026 Business Update Review

United Overseas Bank Limited (SGX: U11): 1Q FY2026 Business Update Review

Related Documents:

OCBC 1Q FY2026 Results Press Release
OCBC 1Q FY2026 CEO Presentation
OCBC 1Q FY2026 Results Highlights

Disclaimer: At the time of writing, I am a shareholder of Oversea-Chinese Banking Corporation Limited. 

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