Broker Name: CGS International
Date of Report: November 6, 2025
Excerpt from CGS International report.
- UOB’s 3Q25 profit after tax and minority interests (PATMI) dropped 72.5% year-on-year due to a large one-off provision of S\$1.36bn, mainly to strengthen coverage against risks in its US and Hong Kong commercial real estate portfolio.
- Management indicated that elevated credit costs were pre-emptive and expects credit costs to normalise to 25-30 basis points for 4Q25 and FY26, with confidence in loan growth and improved fee income for 2026.
- UOB’s net interest margin (NIM) eased to 1.82% in 3Q25, reflecting lower interest rates, while loan growth remains on track for low single-digit growth.
- The report maintains a Hold rating on UOB with an unchanged target price of S\$38.30, citing upside risks from resilient NIMs and downside risks from macroeconomic uncertainty.
- Key financial forecasts anticipate a recovery in net profit and return on equity in 2026, with continued investment in IT and stable dividend yields.
- Sector comparison tables show UOB’s valuation and performance relative to peers in Singapore, Indonesia, Malaysia, and Thailand.
Above is an excerpt from a report by CGS International. Clients of CGS International can be the first to access the full report from the CGS International website: https://www.cgs-cimb.com
