OCBC Cuts 2025 Net Interest Income Outlook After Q2 Profit Falls

OCBC, Singapore's second-largest bank, has cut its 2025 net interest income outlook due to global trade disruptions and lower interest rates. The lender's Q2 net profit fell 7% to $1.82bn, driven by a 6% drop in net interest income. Despite this, OCBC maintained its other 2025 financial targets and declared an interim dividend of 41 Singapore cents.

Singapore's second-largest bank, Oversea-Chinese Banking Corp (OCBC), has revised its 2025 net interest income outlook downward due to global trade disruptions and lower interest rates. The lender's second-quarter (Q2) net profit fell by 7% to S$1.82 billion ($1.40 billion), primarily driven by a 6% decline in net interest income. Despite this, OCBC maintained its other 2025 financial targets and declared an interim dividend of 41 Singapore cents.

"The outlook ahead remains challenging," said OCBC Group Chief Executive Helen Wong in a presentation accompanying the earnings results. She attributed the slowdown to evolving trade and monetary policies, as well as persistent geopolitical tensions. OCBC expects its 2025 net interest income to be lower by a mid-single-digit percentage and projects its net interest margin to be in the range of 1.90% to 1.95%, compared to the previous target of around 2%.

OCBC's Q2 net profit of S$1.82 billion matched the mean estimate of nearly S$1.82 billion from three analysts polled by LSEG. The bank's net interest margin slipped to 1.92% during the quarter from 2.20% a year earlier. Return on equity declined to 12.3% from 14.2% in the same period of 2024. OCBC declared an interim ordinary dividend of 41 Singapore cents.

Wong, the first female to head the bank, will retire at the end of this year. Tan Teck Long, OCBC's head of global wholesale banking, will succeed her. OCBC is the first Singaporean lender to report its earnings for the period, following a mixed bag of results from major global lenders such as Standard Chartered and HSBC Holdings.

[1] https://www.marketscreener.com/news/singapore-s-ocbc-sees-lower-2025-net-interest-income-q2-profit-matches-forecasts-ce7c5fd2d88cf024