OCBC 2002 net profit down 14.3% amid weak economy

  • Business
  • Wednesday, 26 Feb 2003

SINGAPORE’S smallest lender, OCBC Bank, announced plans for regional expansion yesterday after reporting a 14.3% fall in 2002 net profit to S$666.71mil, hit by the city-state's weak economy and a lack of one-time gains.  

The bank had made a net profit of S$785mil the previous year. 

OCBC chief executive David Conner said the bank, which has about 60 branches in Singapore and 25 in Malaysia, planned to expand outside of these strongholds to other South-East Asian nations and China. 

“The overall aim is to become established in another country other than Singapore and Malaysia and be poised to add another country in three years,” he said in a statement accompanying the results. 

For calendar 2002, OCBC put aside less money for possible bad loans, with provisions for the group down 3.3% at S$500.6mil. 

The group's total assets fell 1.6% to S$84.1bil as customer loans shrank 4.7% on the year to S$47.3bil.  

It said the decline reflected weak demand for loans as well as its cautious approach to lending. 

OCBC, which is controlled by the family of tycoon Lee Seng Wee, said its second-half profit amounted to S$349.44mil, against S$344.63mil in the same period of 2001.  

The year-earlier period result was boosted by a one-off after-tax gain of S$252mil from the sale of its stake in Overseas Union Bank. 

Net interest income rose 8.4% to S$1.51bil as the bank enjoyed a full-year contribution from Keppel Capital Bank, which it acquired in 2001. 

OCBC has raised its total dividend to 20 Singapore cents for 2002 from 18 cents the year before. – Reuters  

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