Wednesday, February 17, 2016

OCBC Group posts FY2015 net profit of $3.9 billion

Overseas-Chinese Banking Corporation (OCBC) reported net profit after tax of $3.9 billion for FY2015 ended December.

Excluding a one-off gain of $391 million in FY14, core net profit after tax rose 13% to a new record. This was driven by higher net interest income, fee and commission income growth, as well as improved trading and investment income.

The group’s results also included the full year earnings contribution of OCBC Wing Hang, which became a subsidiary in 3Q14.

Net interest income grew 10% to a new high of $5.19 billion, largely due to an 11% increase in average balances of customer loans, which included the full-year consolidation of OCBC Wing Hang.

Net interest margin was higher for the quarter and was stable at 1.67% for FY15, reflecting improved customer loan yields, particularly in Singapore, which were offset by reduced returns from money market gapping activities.

Non-interest income, before one-off gains, grew 10% to $3.53 billion. Fee and commission income increased 10% to a record $1.64 billion, mainly from growth in wealth management, brokerage and fund management fees.

Net trading income, primarily treasury-related income from customer flows rose 52% to $552 million, while net gains of $204 million from the sale of investment securities were 53% higher than the previous year.

Life assurance profit from Great Eastern Holdings of $630 million was 18% lower, largely as a result of unrealised mark-to-market losses in its bond investment portfolio.

The group’s share of results of associates and joint ventures in 2015 was $353 million, up from $112 million a year ago. This was due to the full-year consolidation of income contribution from Bank of Ningbo as an associated company of the group.

Shares in OCBC ended at $7.64 on Tuesday.

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