Financial Highlights
Strong performance across the franchise and resilient asset quality
Net Profit After Tax and Return on Equity
UOB Group reported net profit of $4.1 billion, 40% higher than a year ago driven by stronger income growth and lower credit allowance as Singapore and regional economies gradually recovered. Correspondingly, return on equity increased to 10.2% for the year.
Net Profit After Tax
$
4.1
billion
+ 40%
Return on Equity
10.2
%
+ 2.8% pt
Net Interest Income and Margin
Net interest income increased 6% against last year to $6.4 billion, led by strong loan growth of 10% with net interest margin stable at 1.56% as a result of proactive balance sheet management.
Net Interest Income
$
6.4
billion
+ 6%
Net Interest Margin
1.56
%
- 0.01% pt
Net Fee and Commission Income
Net fee and commission income rose 21% to a record of $2.4 billion, driven by double-digit growth in most activities. Loan fees hit a new high as trade and investment transactions picked up momentum.
Wealth management fees similarly grew to a record level $0.8 billion on the back of returning investor confidence. This resulted in a 4% year-on-year growth in assets under management to $139 billion.
Wealth management fees similarly grew to a record level $0.8 billion on the back of returning investor confidence. This resulted in a 4% year-on-year growth in assets under management to $139 billion.
Fee Income
$
2.4
billion
+ 21%
Net Fee/Total Income ratio
25
%
+ 3% pt
Trading and Investment Income
Trading and investment income decreased 17% to $0.7 billion due to lower non-customer trading income as there were larger gains from bond sales and unrealised gains on hedges in 2020 amid the lower interest rate environment.
Customer-related income reached record high with year-on-year growth of 10%, as more customers hedging exposures alongside returning business volume growth.
Customer-related income reached record high with year-on-year growth of 10%, as more customers hedging exposures alongside returning business volume growth.
Trading and Investment Income
$
0.7
billion
- 17%
Customer-related Income/Trading and Investment Income ratio
72
%
+ 17% pt
Operating Expenses
Total expenses increased modestly by 3% as a result of the Group’s disciplined spend, as it prioritised strategic investments in people and technology, including scaling up of digital offerings in Singapore and ASEAN. Correspondingly, the cost-to-income ratio improved 1.5% points to 44.1%.
Operating Expenses
$
4.3
billion
+ 3%
Cost/Income ratio
44.1
%
- 1.5% pt
Impairment Charge on Loans
Total allowance on loans declined to $0.6 billion, as the Group’s pre-emptive general allowance taken in 2020 remained adequate. Total credit costs on loans decreased 37 basis points to 20 basis points as the credit outlook stabilised.
Impairment Charge on Loans
$
0.6
billion
- 62%
Total Credit Costs
20
bps
- 37bps
Staying focused on our regional strategy and customer centricity
* Income derived from the treasury flow from Group Retail and Group Wholesale Banking customers is reflected in the income of the respective business segments.
Operating Profit by Business Segment
Group Retail
Compared with a year ago, operating profit decreased 2% to $2.0 billion. Total income was sustained at $4.1 billion as the strong recovery in wealth management and credit card activities helped to offset the impact of thinner margins. In particular, assets under management from high affluent customers reached a new record of $139 billion, with 57% coming from overseas customers served by the Group’s network of wealth management centres in Southeast Asia. Expenses increased 2% to $2.1 billion, primarily from technology-related investments while discretionary spend remained closely managed.
Group Wholesale Banking
Operating profit grew 8% to $3.4 billion on the back of improved business sentiment as the Group’s strong client franchise drove robust loan and fee growth from large corporate and institutional clients. Cross-border income grew 10%, with business activities picking up towards the end of the year as clients increasingly tapped the Group’s regional connectivity capabilities. Expenses grew 9% from continued strategic investments in people and technology.
Global Markets
Operating profit declined 23% to $0.4 billion in 2021, arising from lower sales of investment securities and narrower spreads than at the beginning of the global pandemic.
Operating Profit by Geographical Segment
Overseas franchise provided diversification and
cross-border connectivity
$ million
FY2021
FY2020
YoY%
Singapore
2,839
2,592
10
Rest of Southeast Asia
1,327
1,302
2
Malaysia
689
675
2
Thailand
407
392
4
Indonesia
221
211
5
Others
10
24
(57)
North Asia
605
548
10
Rest of the World
706
550
28
Total
5,476
4,992
10
Singapore
Operating profit rose 10% to $2.8 billion in 2021 on the back of broad-based income growth as Singapore led the region’s economic recovery.
Rest of Southeast Asia
The Rest of Southeast Asia franchise showed a more modest growth of 2% against last year as the pace of recovery was uneven.
North Asia
The strong rebound in North Asia, which grew 10%, was driven by fee as trade and investment activities in Greater China resumed momentum in 2021.
Rest of the World
Operating profit increased 28% to $0.7 billion, led by growth in the US, Australia and Europe markets.
1
Loans by geography are classified according to where credit risks reside, largely represented by the borrower’s country of incorporation/operation for non-individuals and residence for individuals.
Resilient balance sheet with stable credit outlook
Asset Quality
The Group’s overall loan portfolio remained resilient with non-performing loan (NPL) ratio steady at 1.6%.
Total allowance for non-impaired assets remained adequate at $2.9 billion with the coverage for performing loans maintained at 1.0%.
Total allowance for non-impaired assets remained adequate at $2.9 billion with the coverage for performing loans maintained at 1.0%.
Total Allowance on Assets
$
4.5
billion
- 1%
NPL ratio
1.6
%
unchanged
Funding and Liquidity Ratios
The Group’s liquidity and funding positions remained healthy with the average all-currency liquidity coverage ratio (LCR) at 135% and net stable funding ratio (NSFR) at 116%, well above the minimum regulatory requirements.
LCR
135
%
unchanged
NSFR
116
%
- 9% pt
Capital Adequacy Ratio (CAR)
As at 31 December 2021, the Group’s capital position remained strong with Common Equity Tier 1 (CET1) ratio and Total CAR at 13.5% and 16.6% respectively, well above the Monetary Authority of Singapore’s minimum requirement.
CET1 CAR
13.5
%
- 1.2% pt
Total CAR
16.6
%
- 1.8% pt