In a spectacular display of financial prowess, UOB Group has once again turned heads, reporting a record net profit of S$6.0 billion for the financial year ending December 31, 2024. This impressive achievement marks a notable 6% year-on-year increase, highlighting the bank’s robust performance and its ability to navigate the ever-shifting tides of the global market.
The bank’s board of directors, evidently in a celebratory mood, has proposed a final dividend of 92 cents per ordinary share. Combined with the interim dividend of 88 cents per share, this totals a generous S$1.80 per ordinary share for FY24 — equivalent to a payout ratio of approximately 50%. But wait, there’s more! To spread the joy, they unveiled a S$3 billion package set to distribute surplus capital over the ensuing three years, including special dividends and share buybacks. This includes a special dividend of 50 cents per share in 2025, marking UOB’s 90th anniversary with style.
Diving into the nitty-gritty details, the Group’s net profit ascended to new heights thanks to a vibrant cocktail of strong net fee income alongside trading and investment income. Net interest income, seasoned with a steady S$9.7 billion seasoning, made for a delectable financial feast in light of a healthy 5% loan growth. Not to be outdone, net fee income flourished, growing by 7% to S$2.4 billion, propelled by a double-digit surge in wealth fees, robust credit card charges, and escalating loan-related fees. Meanwhile, UOB’s asset quality remains as robust as ever, with a non-performing loan (NPL) ratio comfortably nestled at 1.5%.
The Group’s Wholesale Banking sector continued to ride the waves of success, with trade loans experiencing a whopping 20% increase from the previous year. Transaction banking business steadfastly held its ground and now contributes more than half of Wholesale Banking’s income. Notably, cross-border income also saw a fruitful rise, now representing over a quarter of this unit’s total income.
Not to be overshadowed, UOB’s Retail division also shone brightly throughout FY24. Credit card fees galloped ahead, boasting an 18% year-on-year surge, buoyed by sustained consumer spending and an ever-growing regional presence. Wealth management income soared 30%, fueled by rejuvenated investor confidence. The Group also experienced robust net new money inflows, pushing their high-net-worth assets under management to S$190 billion, an impressive 8% growth compared to the previous year!
Adding to this kaleidoscope of success, UOB embraced its sustainability mission wholeheartedly throughout 2024. In November, they published their second progress report on their net-zero pledge, with positive outcomes emerging across priority sectors, particularly in power. By the end of 2024, the sustainable financing portfolio saw a 43% boost, reaching S$58 billion—an endorsement of UOB’s dedicated commitment to green endeavors.
In his statement, UOB’s Deputy Chairman and Chief Executive Officer, Mr. Wee Ee Cheong, waxed lyrical about the company’s victorious year. He emphasized how UOB’s long-standing investments in regional platforms are finally paying off. Despite global economic turbulence, Mr. Wee remains optimistic about the ASEAN region’s resilience, driven by increased domestic retail spending and a rising tide of foreign direct investment.
Reflecting on UOB’s 90-year journey, Mr. Wee also expressed gratitude towards the unwavering support from stakeholders, partners, and customers alike. As UOB charts its course into the future, their disciplined approach and focus on stability and long-term growth promise to bring greater value to everyone involved.
When looking at the comparison between FY24 and FY23, net profit for FY24 jumped by 6% to hit a new peak of S$6.0 billion, bolstered by a formidable combination of net fee income, alongside trading and investment income. Core net profit, after excluding one-off expenses, clocked in at S$6.2 billion. Net fee income experienced enviable 7% growth year-on-year, driven by enthusiastic investor sentiments and dynamic credit card activities. On the other hand, other non-interest income gleefully rose by 10% to S$2.2 billion, courtesy of a treasury income surge from retail bond sales and hedging demands.
The core operating expenses saw a moderate 5% increase amounting to S$6.1 billion, reflecting the Group’s ongoing investment in regional capabilities. Meanwhile, the total allowance remained stable at S$926 million, reinforcing UOB’s stability in the face of financial challenges.
So, while UOB closes off a remarkable year of record-breaking profits, they remain firmly positioned for future success, armed with robust capital, liquidity, and a strategic plan to seize opportunities in the region. All in all, it’s been a year for the books, and UOB seems ready and eager to write the next chapter of its storied history.
A 6% jump in net profit is really impressive, but let’s not forget the underlying issue here: the income inequality within the banking sector. How much of that $6 billion actually benefits the everyday customer?
That’s a fair point, but UOB is following through with dividends and a special dividend next year. Shareholders certainly benefit!
Sure, shareholders are happy, but what about the bank employees and customers who aren’t major shareholders?
Dividends are part of owning shares; if employees want a slice like that, maybe they should be investing some savings in the company they work for.
But isn’t it the whole point of capitalism to reward those who can invest in shares? If you work for the bank and don’t invest, maybe that’s on you.
The growth in their wealth management division is staggering. Clearly, the rich are getting richer and the banks are just opening their arms wider.
To be honest, it’s no surprise anymore. The banks definitely know where the money lies and cater to it.
True, but I wonder how this impacts the overall economy. Concentrating wealth can have long-term effects we don’t foresee.
And how much of that wealth growth is actually sustainable? What happens when markets fluctuate?
I must say, UOB’s focus on sustainability is commendable. A 43% boost in sustainable financing shows they’re thinking forward.
Yes, but let’s see how rigorous their net-zero goals are. It’s easy to make pledges, harder to meet them with actual results.
Agreed, but their report seems credible for now. I’ll keep an eye on future updates.
Their retail division’s performance is noteworthy, all thanks to us spending more with credit cards!
I wonder how much of this success is driven by increased fees and charges rather than genuine growth strategies?
It’s all about finding the right balance, and it seems like UOB is capitalizing on both.
Banks report record profits, yet fees and service charges keep rising for consumers. Seems like a broken record!
Totally agree. It feels like we’re footing the bill for their successes!
Exactly! Profits shouldn’t just benefit the top echelons.
But you can’t deny, having a profitable bank is better for the economy than a struggling one.
Reading new heights for UOB’s profit always makes me hopeful for ASEAN’s growth prospects.
I love reading about profit increases like these. They make investing in banks feel so secure!
Share buybacks and special dividends are smart moves; they’re managing capital efficiently!
It’s a powerful message to shareholders for sure!
Exactly, it reassures investors about their long-term commitment.
I wish my bank would give me a slice of that sweet S$1.80 per share action. Sigh, missed investment opportunity!
I’m just waiting to see how banks handle rising interest rates globally. A big test for strategies!