OCBC Q2 profit drops 7% as interest rates fall

OCBC Bank posted a 7 per cent fall in earnings for the second quarter, as declining interest rates weighed on net interest income.

- Sheila Chiang

Net profit for the three months to June 30 was $1.82 billion, down from $1.94 billion a year earlier. Still, the figure beat the $1.79 billion forecast in a Bloomberg poll.

The bank also declared an interim dividend of 41 cents per share, down from 44 cents a year ago.

At a results briefing on Aug 1, outgoing chief executive officer Helen Wong said the first-half performance benefited from better-than-expected growth across the region and front-loading activities ahead of US tariffs.

However, geopolitical tensions and the potential inflationary impact from tariff shocks continue to cloud the operating environment in the second half, she said.

The bank forecasts global and regional growth to slow in the second half-year, but expects its strong balance sheet and capital position to navigate volatilities.

It maintains a long-term positive on regional growth, as trade investment and wealth flows across Asean and Greater China continue.

"We still see a pocket of growth opportunity in the region and our key markets," said Ms Wong.

OCBC expects its 2025 net interest income to be lower by a mid-single-digit percentage.

It maintained most of its 2025 financial targets, including mid-single-digit loan growth and credit costs in the range of 20 to 25 basis points. Net interest margin (NIM) is expected in the region of 1.9 per cent to 1.95 per cent, down from the region of 2 per cent previously.