OCBC Bank's second quarter net profit down 26% from previous quarter

OCBC's net profit dropped to S$503 million, from S$676 million for the first quarter, with volatile financial markets resulting in a 35% decline in net trading income.

Although compared to the same period in 2009, net profit grew by 8% from S$466 million due to increased fees and commissions, higher realised gains on investment securities and lower allowances.

In addition, Oversea-Chinese Banking Corporation Limited’s second quarter result included three months’ consolidation of the results of Bank of Singapore, or what's formerly known as ING Asia Private Bank which was acquired in January 2010.

OCBC Bank reported, “Second quarter net interest income grew by 1% over the previous year to S$720 million, led by an 18% increase in average interest earning assets which more than offset the decline in net interest margin. Loan growth was broad-based in the consumer, corporate and SME segments in Singapore and overseas. Non-interest income increased 5% to S$516 million, led by a 30% growth in fee and commission income, and higher realised gains from the sale of investment securities.”

However, the Group said quarter-on-quarter growth in net interest income and fees and commissions was offset by 35% decrease in net trading income, 26% drop in profit contribution from insurance subsidiary Great Eastern Holdings and 24% rise in operating expenses.