Singapore's UOB triples Vietnam operating profit to $10.5 mln in H1

Singapore’s United Overseas Bank (UOB) recorded a core operating profit of SGD14 ($10.5 million) from activities in Vietnam in the first half of 2023, nearly tripling year-on-year, according to the bank’s latest report.

The figure included SGD8 million ($6.01 million) in the second quarter of the year, up from SGD6 million ($4.51 million) in Q1.

UOB noted that the ASEAN-4 group, consisting of Vietnam, Malaysia, Indonesia, and Vietnam, benefited from Citi consolidation. Citi integration costs at UOB reached SGD159 million ($119.45 million) in H1/2023.

Globally, UOB’s core operating profit skyrocketed 48% year-on-year to SGD4,177 million (nearly $3.14 billion), of which overseas markets accounted for 42.1% and Singapore, the domestic market, made up 57.9%.

The lender’s gross loans in Vietnam grew 21% year-on-year to SGD2 billion ($1.5 billion) as of end June 2023.

Globally, UOB’s gross loans inched down 1% to SGD319 billion ($239.66 billion) in the period, partly thanks to the constant currency basis. On a quarter-on-quarter basis, UOB’s gross loans increased 1%, driven by activities in Singapore, North Asia, and developed markets.

Regarding total funding, UOB’s figure in Vietnam went up 18% year-on-year to SGD2 billion ($1.5 billion) as of end June 2023. For global performance, UOB’s total funding was SGD437 billion ($328.31 billion), up 1% year-on-year; including SGD377 billion ($283.23 billion) of customer deposits, up 5%, and SGD61 billion ($45.83 billion) from wholesale funding, down 18%.

UOB continues expansion in Vietnam

UOB has been expanding its activities in Vietnam. At the Singapore Regional Business Forum held in Hanoi on July 7, UOB and the Foreign Investment Agency (FIA) under Vietnam's Ministry of Planning and Investment signed a memorandum of understanding (MoU) to further facilitate foreign direct investment inflows into Vietnam. This was an elevation of the first MoU signed by the two sides in 2015. The first MoU facilitated investments of SGD5.7 billion ($4.28 billion) in Vietnam.

At the event, UOB FinLab, an innovation accelerator powered by UOB, Singapore's Ngee Ann Polytechnic (NP), Vietnam's Foreign Trade University, and Vietnam's National Innovation Center (NIC) signed three MoUs on growing Vietnam’s small and medium-sized enterprises (SMEs) network, supporting businesses in their digitalization and sustainability journeys, and giving internships to students.

UOB on May 11 said that its completion of the merger with Citi's consumer banking arms in Malaysia, Thailand, and Vietnam had boosted its regional customer count from five million to over seven million as of the end of March. UOB has added 15 branches to its network across Malaysia, Thailand, and Vietnam.

The move brought its total number of branches in the three countries to over 200, at a time when UOB, Singapore’s third-largest bank, aims to take a bigger bite of Southeast Asia’s vast retail market.