Even after United Overseas Bank’s (UOB) share price gained over 10% in November, DBS Group Research analyst Lim Rui Wen believes there is further room for the counter to grow amid expectations of a gradual pick-up in the economy.

“[UOB’s] strong non-performing asset (NPA) coverage of 111% (2QFY2020: 96%) and ongoing provisioning (management guides for S$2-3bn through FY2020-2021F) will limit downside risks. Management has guided for better-than-expected asset quality outlook during 3QFY2020 results briefing,” she notes in a company update dated Nov 24.

Despite UOB’s dividend cut, Lim still views its yield of 4% “relatively attractive” with the bank’s management indicating its willingness to revert to its FY2019 dividend policy.


To continue reading,

Sign in to access this Premium article.

Subscription entitlements:

Less than $9 per month
3 Simultaneous logins across all devices
Unlimited access to latest and premium articles
Bonus unlimited access to online articles and virtual newspaper on The Edge Malaysia (single login)

Stay updated with Singapore corporate news stories for FREE

Follow our Telegram | Facebook