UOB - Maybank Research 2026-02-24: Limited Capital Returns Upside Near Term

• We raise UOB's target price to S$38.86. However, with limited capital management catalysts in the near-term, maintain HOLD.
• UOB (SGX:U11)'s FY25 core-earnings were in-line with MIBG/Street expectations. While big pre-emptive provisioning seems to be behind them, we are cautious given continued stresses in commercial real estate as well as increases in NPLs in manufacturing and construction.
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Kitchen sinking done? We remain cautious.

• Credit costs dropped to 19bps in 4Q from 134bps in 3Q. However, we note overall provisions to NPLs have fallen to 97% from 100% in 3Q and still lag peers (DBS 130% in 4Q). NPL upgrades/write-offs increased +108% q-o-q, with around 50% classified as write-offs. This is mostly in the real estate sector. GP coverage of CRE hotspots – Greater China and US – have been boosted, but the sector remains a known risk.
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Operational momentum positive.

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Above is an excerpt from a report by Maybank Research.
Clients of Maybank Securities may be the first to access the full PDF report @ https://www.maybanktrade.com.sg/.

Previous report by Maybank:
2025-11-06 UOB - Low Visibility, High Provisions, Falling Dividends Limit Catalysts.

Price targets by 4 other brokers at UOB Target Prices.

Listing of research reports at UOB Analyst Reports.

Relevant links:
UOB Share Price History,
UOB Announcements,
UOB Dividend Payout Dates & Corporate Actions,
UOB News