The economic slowdown in China will affect Oversea-Chinese Banking Corp’s ability to grow its loans business this year, the lender’s chief executive said on Friday.
OCBC, the second-largest Singaporean bank by assets, reported a 9 percent increase in customer loans in 2018. That growth rate is expected to moderate this year amid greater uncertainties in China and globally, said its CEO Samuel Tsien.
“Despite that there’s a slowdown, the market is still growing … We still expect that the market will offer us opportunities to continue to grow as we have done in the past,” Tsien told CNBC’s Martin Soong when asked about the impact of China&’s slowdown.
“I do expect that our loan growth for this year will be lower than that we saw last year. Last year’s loan growth was 9 percent, we expect this year’s to slow down to low- to middle-single digit,” he said, after the bank reported its full-year earnings.
The Greater China region was the second-largest profit contributor for OCBC in 2018, after its home market Singapore. The region accounted for 19 percent of the bank’s overall profit before tax last year and about 25 percent of its total customer loans.
OCBC rounded up the earnings release of the three Singapore-listed banks. The lender reported an 11 percent fall in net profit last year.
In contrast, OCBC’s smaller peer United Overseas Bank announced on the same day an 18 percent increase in annual net profit, while Singapore’s largest bank DBS Group Holdings said on Monday its net profit for 2018 rose 28 percent from the previous year.
Shares of OCBC declined by close to 2 percent in Friday trading, while UOB fell by nearly 2 percent and DBS inched up close to 1 percent.