OCBC Quarterly Profit Rises 32% on Insurance, Trading Income - Bloomberg

By Sanat Vallikappen -

Oversea-Chinese Banking Corp. (OCBC), Southeast Asia's second-largest lender, posted a 32 percent increase in first-quarter profit on higher income from insurance, trading and gains from investments.

Net income advanced to S$832 million ($664 million) in the three months ended March 31 from S$628 million a year earlier, the lender said in a statement to the stock exchange today. That exceeded the average S$632 million of seven analysts' estimates compiled by Bloomberg.

Chief Executive Officer Samuel Tsien aims to ease the bank's revenue dependence on Singapore and Malaysia, where it gets more than 80 percent, by growing in overseas markets including China and Indonesia. Income from businesses including wealth management, trading, and its Great Eastern insurance unit rose 28 percent from a year earlier, while higher lending helped offset declining loan profitability, the company said today.

"Great Eastern results were super-strong," said Wee Siang Ng, a banking analyst at BNP Paribas Securities Singapore Pte, before the results, referring to the 65 percent increase in first-quarter profit announced by the unit on May 4.

Tsien, who took over as CEO from David Conner last month, is competing with Singapore-based rivals to expand in Asia as banks in the city-state face the lowest loan profitability in Southeast Asia.

To contact the reporter on this story: Sanat Vallikappen in Singapore at vallikappen@bloomberg.net

To contact the editor responsible for this story: Chitra Somayaji at csomayaji@bloomberg.net