UOB posted 2Q15 net earnings of S$762m this morning, down 5.7% YoY and 4.9% QoQ, and below market expectations of S$831m as polled by Bloomberg. The decline was largely attributed to lower trading and investment income which fell 30.5% QoQ to S$156m. Net Interest Income improved, up 7.9% YoY and 1.0% QoQ to S$1213m in 2Q15.

Net Interest Margin (NIM) improved from 1.71% in 2Q14 and 1.76% in 1Q15 to 1.77% in 2Q15. Total expenses also moved higher, up 11.4% YoY and 2.8% QoQ to S$877m. Interim dividend payout went up from 20 cents to 35 cents. We will provide more update after the analysts’ briefing. Do note that our rating before the results was a BUY but we will reassess our estimates after the briefing.

Source: OCBC Research - 31 Jul 2015