UOB’s Q1 earnings slip to $1.4b on weaker interest income

Fees and trading supported results as margin pressure and rates constrain earnings.

UOB Group reported a net profit of $1.4b for the first quarter (Q1) of 2026, up 2% quarter on quarter (QoQ) but down 4% year on year (YoY), reflecting lower net interest income and fee income amidst softer market conditions.

According to the group’s released earnings statement, net interest income fell to $2.3b, mainly due to lower interest rates, though this was partly offset by 4% loan growth. Net interest margin narrowed 2 basis points to 1.82%.

CGS International (CGSI) had previously flagged continued margin pressure from falling regional rates such as SORA and HIBOR, alongside a high base effect that would weigh on year-on-year comparisons, even as loan growth provided partial support. 

UOB said net fee income rose 2% QoQ to $637m, supported by higher capital markets activity and steady wealth-related income, whilst card fees eased after a seasonal peak in the previous quarter.

Other non-interest income increased 45% QoQ to $462m, driven by stronger customer treasury income and trading gains during a volatile market period, said the group.

Total expenses were stable at $1.5b, with the group saying this improved its cost-to-income ratio to 44.5% from 46.4% in the previous quarter.

Allowance for credit losses rose to $203m, with credit costs at 26 basis points whilst non-performing loan ratio remained at 1.5%.

UOB said its Common Equity Tier 1 capital ratio stood at 15.3% at the end of the quarter.