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Thursday, 5 November 2026
Markets

DBS and OCBC Shares Reach New Highs on Strong Q3 Earnings While UOB Underperforms

By Chee Liang CFA3 min read

Singapore, 10 November 2025 – Singapore’s banking sector showcased a clear divergence in third-quarter performance as DBS Group and OCBC Bank outpaced expectations, lifting their shares to fresh highs, while United Overseas Bank (UOB) recorded a steep profit decline, weighed down by elevated credit provisions.

DBS posted a net profit of S$2.95 billion for the quarter ended 30 September, down just 2% from a year earlier but surpassing analysts’ estimates of S$2.79 billion. The result was underpinned by record total income of S$5.93 billion (+3% y/y), driven by strength in fee income and deposit inflows, even as net interest margin (NIM) fell to 1.96% from 2.11%. The bank declared a total dividend of 75 cents per share (ordinary 60 cents + capital return 15 cents). DBS shares climbed to a historic high of S$55.59, although some gains were trimmed to close around S$54.98.

Meanwhile, OCBC delivered a net profit of S$1.98 billion, largely flat year-on-year but above the S$1.79 billion forecast. The performance was supported by a 15% increase in non-interest income to S$1.57 billion and a drop in allowances to S$139 million (-18% y/y). OCBC shares surged to a record S$17.94 before paring back gains to close at S$17.78 (+3.4%).

In stark contrast, UOB’s Q3 net profit plunged 72% to S$443 million from S$1.61 billion a year ago, as the bank set aside S$1.36 billion in credit provisions, including S$615 million in general allowances. The bank also forecast a lower NIM for 2026 in the 1.75%-1.80% range, down from earlier expectations of 1.85%-1.90%. UOB’s share price ended the week down nearly 2.3%.

What’s Driving the Divergence

  • Fee income strength & wealth growth: DBS highlighted a 25% surge in loan-related fees and a 33% rise in trading income.
  • Margin pressures: Both DBS and OCBC saw NIMs compressed by lower interest rates, emphasising the importance of non-interest income to offset the effect.
  • Asset-quality divergence: UOB’s heavy provisioning reflects caution amid regional macro risks, whereas DBS and OCBC showed stable asset metrics (e.g., DBS non-performing loan ratio at 1.0%).
  • Market confidence and dividend signals: The combination of earnings beats and dividend enhancements at DBS and OCBC underpinned positive investor sentiment.

Implications for Investors & the Region

  • The strong share-performances of DBS and OCBC may prompt portfolio reallocations toward Singapore’s top-tier banks, particularly those exhibiting resilience amid margin headwinds.
  • The divergence signals that execution and fee diversification are becoming key differentiators in a low-rate environment for regional banks.
  • For Asia-Pacific investors, Singapore banks remain a bellwether for broader credit-cycle and interest-rate developments in the region.
  • Analysts will be watching how banks manage funding costs, deposit growth, and loan-book composition in the face of margin compression.

What to Watch Next

  • Q4 results and 2026 guidance: whether banks can maintain fee momentum and control costs.
  • NIM trends and funding cost dynamics: how much margin-pressure remains and how banks respond.
  • Asset-quality developments across regional exposures, including Greater China, Indonesia and Southeast Asia.
  • Dividend policies and capital-return programmes: whether consistent earnings enable further shareholder rewards.

Author

  • Chee Liang CFA

    Chee Liang CFA specializes in financial advice and global economic trends, delivering clear insights to help readers navigate markets, investments, and the shifting dynamics of the world economy.