OCBC's profit jumped 11% to $1.23b in Q1

Non-interest income surged 24% to $1.14b.

OCBC started the year on a positive note as net profit climbed 11% YoY to $1.23b in Q1. This was driven by record operating profit before allowances, which was underpinned by strong income growth across the group’s banking, wealth management and insurance franchise, OCBC noted.

Net interest income grew 8% YoY to $1.53b, lifted by healthy asset growth and a rise in net interest margin (NIM). Customer loans rose 5% to $259b boosted by broad-based growth across key markets.

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Overall loan growth hit 5% to $259b, of which $109b was recorded in Singapore. According to the bank, NIM rose 9 basis points to 1.76%, mainly from higher asset yields in a rising interest rate environment and an increase in gapping income from money market placements.

Asset quality was also held stable as new non-performing loan (NPL) formation in Q1 shrank to $298m from $881m in Q4 2018. Meanwhile, total non-performing assets (NPA) dipped 0.5% to $3.92b QoQ, whilst NPL ratio is unchanged at 1.5%.

Meanwhile, non-interest income jumped 24% to $1.14b. The group’s net trading income more than doubled to $285m, from $94m a year ago, bolstered by the increase in customer flow income as well as improved financial market conditions. Meanwhile, profit from life insurance jumped 40% YoY to $233m, whilst the group’s overall wealth management-related income also rose 27% YoY to $921m.

OCBC’s earnings per share came in at $1.6, 8.4% higher from $1.07 or a 9.4% increase from $1.06 for the full year of 2018.