- OCBC's 3Q24 earnings of S$1.97bn were above our estimates owing to a surge in trading income and higher fees and commission income. 9M24 PATMI was 81% of our FY24e forecast.
- NII grew 2% y-o-y from loan growth of 2% y-o-y offset by NIM dipping 6bps y-o-y to 2.20%. Total non-interest income rose 13% y-o-y, led by broad-based growth from fee, trading, and insurance income. Allowances dipped 43% due to lower GPs as credit costs improved to 15bps.
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The Positives
Trading drives non-interest income.
- OCBC's trading income hit a new quarterly high of S$508mil (+135% y-o-y) from higher customer flow income and was the main driver for non-interest income growth (+41% y-o-y). This was also supported by fee income growth from higher WM, investment banking, and loan-related fees, while insurance growth was supported by robust underlying business performance.
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Allowances down 8% y-o-y, credit costs at 22bps.
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