OCBC predicted to suffer 'mean reversion' vs stellar 4Q12 results

Profit likely to stay flat at $667m.

According to CIMB, they expect OCBC to report 1Q13 net profit of S$667m (flat qoq, in line with consensus). Market expectations of a qoq earnings decline stem largely from analysts expecting a mean reversion from an over-achieving 4Q12, inflated by trading gains and insurance strength. 

CIMB also said that they do not expect the insurance non-par gains enjoyed in 2H12 to repeat in 1Q13.

Here's more from CIMB:

Reviewing bond indices, we note that there was a slight uptick in bond yields (i.e., bond prices fell) in Jan and Feb, though the worsening of Cyprus woes in late Mar helped bonds recover to end 1Q13 flat.

There should not be the same level of non-par gains. Otherwise, we expect features of 4Q12, including margin pressure and low credit costs (total provisions at around 20bp of loans), to sustain.