SINGAPORE (Aug 2): UOB Group reported earnings of $1.17 billion in 2Q19, 8% higher than a year ago on higher net interest income.

This brings 1H19 earnings to $2.22 billion, up 8% from a year ago and an interim dividend of 55 cents per ordinary share has been declared.

Net interest income for 2Q19 increased 7% to $1.65 billion as gross loans grew 9% year on year.

Net fee and commission income increased 6% to $527 million as wealth management saw strong flows, coupled with higher volume in credit cards and loan-related fees.

Other non-interest income for 2Q19 rose 33% to $403 million, driven by higher trading income and gains from investment securities.

Total expenses increased 11% to $1.13 billion in line with operating income growth, while cost-to-income ratio was maintained at 43.7%.

Total allowances decreased 44% to $51 million, due to a write-back in allowances on non-impaired assets.

As at June 30, loan-to-deposit ratio was healthy at 88.5%.

The non-performing loan ratio stayed at 1.5% with coverage for non-performing assets stable at 84%, or 191% after taking collateral into account.

Total allowances for non-impaired assets stood at $1.98 billion.

The group’s Common Equity Tier 1 CAR remained at 13.9% and leverage ratio at 7.5% was well above the regulatory requirement.

Wee Ee Cheong, UOB’s Deputy Chairman and CEO, says, “The record set of results for the first half of 2019 was achieved against the increasingly challenging macro environment. Our balance sheet remained healthy with robust capital and liquidity positions, while asset quality stayed sound as we continue to grow our franchise selectively. Our recent perpetual capital securities issuance also saw overwhelming interest from investors, reflecting their confidence in the Group’s strong financial standing.”

Shares in UOB closed 12 cents lower at $26.28 on Thursday before the results announcement.