SINGAPORE--Oversea-Chinese Banking Corp. (O39.SG), Southeast Asia's second-largest lender by assets, reported Thursday a 62% increase in its third-quarter net due to gains from its banking operations and a one-off boost from its increased stake in a Chinese bank.
Net profit for the three months ended Sept. 30 rose to S$1.23 billion (US$983.8 million) from S$759 million a year earlier. Net profit for the nine months from the beginning of the year was at a record S$3.05 billion from S$2.05 billion a year ago.
The bank's core net, excluding divestment gains, rose 11% from a year earlier, including the results of Hong Kong lender Wing Hang Bank, which OCBC acquired in July. The Wing Hang net profit contribution accounted for S$38 million after merger-related adjustments, OCBC said in a statement.
Core net for the latest quarter was S$841 million, compared with S$759 million a year ago.
The figures were helped by a one-off S$391 million gain from OCBC's increased stake in China's Bank of Ningbo Ltd. OCBC's initial available-for-sale investment was sold, resulting in a gain for the bank's balance sheet.
OCBC's interest income rose 28% to S$1.25 billion from S$978 million while noninterest income, which includes trading and insurance investment, rose 2.8% to S$801 million from S$779 million.
Operating expenses rose 28%, reflecting the costs of consolidating Wing Hang Bank. In the third quarter, operating expenses were S$870 million compared with S$681 million a year ago. Excluding Wing Hang's contribution, operating expenses grew 16%, OCBC said.
"Our record nine-month results reflect the underlying strength and diversity of our banking and insurance franchise," OCBC chief executive Samuel Tsien said in a statement. "With the addition of OCBC Wing Hang, our earnings and asset base would be further diversified," he said, adding: "I am also pleased to report that the integration of OCBC Wing Hang is progressing well."
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