OCBC Third Quarter Profit Grows 12% on Year

Oversea-Chinese Banking Corp. Ltd. reported Thursday a 12% rise on year in its third quarter net profit as higher interest rates helped income.

Net profit in the July-to-September quarter was 1.06 billion Singapore dollars (US$779 million), compared with S$943 million in the same period last year, the bank said in a statement to Singapore Exchange.

Net interest income rose 12% to S$1.38 billion, helped by an improvement in net interest margin that rose to 1.66% in the quarter from 1.62% last year.

"Business activities and investments are generally picking up in tandem with regional economic trends...However, we will remain watchful of ongoing geo-political event risks and the continuing stress observed in the oil and gas industry," Samuel Tsien, the bank's chief executive, said.

Allowances for bad loans declined to S$156 million in the third quarter, compared with S$166 million last year. OCBC said its bad-loan formation has stabilized. The ratio of nonperforming loans was 1.3% in the third quarter compared with 1.2% a year earlier. However, the bad-loan ratio has remained stable since December, the company said.

Noninterest income rose 1% to S$978 million, while fees and commissions increased 14% to S$488 million, mainly from wealth management, fund management and trade-related income, OCBC said.

Write to Gaurav Raghuvanshi at gaurav.raghuvanshi@wsj.com

(END) Dow Jones Newswires

October 25, 2017 20:11 ET (00:11 GMT)