Deputy Chairman and CEO's Report
Investor Highlights


Financial Highlights

Resilient performance with strong balance sheet fundamentals
Net profit after tax
($ million)
Return on equity
Net Profit After Tax and Return on Equity
UOB Group reported net profit of $2.9 billion, 33% lower than a year ago as economies contracted amid the global pandemic with lower margins from benchmark rate cuts and reduced customer activities. Additional pre-emptive credit allowance of $0.9 billion was set aside during the year to strengthen the balance sheet. Correspondingly, return on equity declined to 7.4% for the year.
Net Profit After Tax
$2.9 billion
Return on Equity
7.4 %
- 4.2% pt
Net Interest income
($ million)
Net Interest margin
Net Interest Income and Margin
Net interest income decreased 8% against last year to $6.0 billion, as policy makers across regional markets reduced interest rates to support the economy and market liquidity.

Against the backdrop of a lower interest rate environment, net interest margin in 2020 fell 21 basis points to 1.57%, more than offsetting the impact of loan growth.
Net Interest Income
$6.0 billion
- 8%
Net Interest Margin
1.57 %
- 0.21% pt
Loan/Trade-related income
($ million)
Wealth management income
($ million)
Net credit card income
($ million)
Other income
($ million)
Net fee/Total income ratio
Net Fee and Commission Income
Net fee and commission income was 2% lower at $2.0 billion, as consumers spent less on their credit cards amid the global pandemic with movement restrictions in place. Loan and trade fees similarly contracted as business was affected by lower trade flows and capital commitments.  

Wealth management fees increased 11% against last year despite a challenging macro environment as customers continued to place their trust with the Group. This resulted in a 6% year-on-year growth in assets under management.
Fee Income
$2.0 billion
- 2%
Net Fee/Total Income ratio
22% %
+ 2% pt
Customer-related income
($ million)
Other income
($ million)
income/Trading and investment income
ratio (%)
Trading and Investment Income
Trading and investment income decreased 21% to $0.9 billion due to lower net trading income on the back of a volatile market in 2020, while customer-related income remained stable.
Trading and Investment Income
$0.9 billion
- 21%
Customer-related Income/Trading and Investment Income ratio55%
55 %
+ 9% pt
Staff costs
($ million)
Other expenses
($ million)
Cost/Income ratio
Operating Expenses
Total expenses decreased 6% to $4.2 billion on the back of the Group’s efforts to balance continued strategic investments in people and technology while reducing discretionary spend.

The cost-to-income ratio was higher at 45.6% due to the decline in revenue caused by pandemic uncertainties.
Operating Expenses
$4.2 billion
- 6%
Cost/Income ratio
45.6 %
+ 1.0% pt
Allowances on
impaired loans
($ million)
Allowance on
non-impaired loans
($ million)
Total credit costs
Credit costs on
impaired loans
Impairment Charge on Loans
Total allowance on loans increased to $1.6 billion from $0.5 billion a year ago, as the Group pre-emptively set aside additional allowance of $0.9 billion for non-impaired loans to ensure adequate coverage as the impact of the pandemic remains uncertain. Total credit costs on loans increased 39 basis points to 57 basis points for the year.
Impairment Charge on Loans
$1.6 billion
> 100%
Total Credit Costs
57 bps
+ 39 bps
Staying focused on our regional strategy and customer centricity
*Income derived from the treasury flow from Group Retail and Group Wholesale Banking customers is reflected in the income of the respective business segments.
Operating Profit by Business Segment
Group Retail (GR)
Compared with a year ago, operating profit decreased 6% to $2.1 billion. Net interest income declined 7% to $2.8 billion as the strong growth in deposits was negated by margin compression following cuts in benchmark rates. Wealth fees grew 11% amid this challenging environment driven by wealth solutioning provided to customers in the areas of bancassurance and treasury needs. The Group will continue to reinforce our omni-channel approach, complementing digital services with physical engagement to meet customers’ needs and to drive growth.
Group Wholesale Banking (GWB)
Operating profit grew 1% to $3.1 billion driven by innovative solutions in cash management, trade services and financing provided to customers. Net interest income increased 2% to $3.0 billion against 2019, supported by loan growth which moderated the impact from margin compression. Non-interest income fell 8% to $1.0 billion, mainly from investment banking, trade and loan-related fees amid disruption to client activities from the pandemic.  
Global Markets (GM)
Operating profit rose 57% to $0.5 billion as compared with the previous year driven by a strong trading performance. Total income grew 29% to $0.8 billion, benefitting from wider spreads following the sharp fall in interest rates.
Operating Profit by Geographical Segment
Regional franchise enabling cross-border flows
Operating profit fell 21% to $2.6 billion in 2020, with margins declining by 35 basis points to 1.13%, more than offsetting the 3% loan growth.
Rest of Southeast Asia
The Rest of Southeast Asia franchise grew 7% against last year, largely supported by strong growth in Indonesia and Malaysia. Indonesia improved 54% to $0.2 billion in 2020, as the launch of TMRW in Indonesia was well-received and opened an alternative funding source that is cost-efficient. Malaysia increased 4% to $0.7 billion due to higher net interest income on government securities and treasury income. Thailand declined 3% to $0.4 billion due to margin compression and lower fee income being impacted by pandemic uncertainties. In Thailand, TMRW also showed promising results as it onboarded more active customers.
North Asia
North Asia was relatively flat against last year due to a slowdown in Greater China but offset by better performance in South Korea.
Rest of the World
Operating profit grew 9% to $0.6 billion, driven mainly by growth in the US and Europe markets.
  1. Loans by geography are classified according to where credit risks reside, largely represented by the borrower’s country of incorporation/operation for non-individuals and residence for individuals.
Maintaining a strong balance sheet to support customers in times of need
Allowance for impaired assets
($ million)
Allowance for non-impaired assets
($ million)
Regulatory loss allowance
reserve (RLAR)
($ million)
Allowance on non-impaired
loans including RLAR/Performing loans (%)
Allowance on impaired
assets/NPA (%)
Asset Quality
The Group’s overall loan portfolio remained sound.
Non-performing loan (NPL) ratio rose to 1.6% as NPL formation was higher in the fourth quarter of 2020 due to several major secured corporate exposures.

Total allowance for non-impaired assets strengthened to $2.9 billion with the coverage for performing loans at 1.0%.
Total Allowance on Assets
$4.6 billion
+ 26%
NPL ratio
1.6 %
+ 0.1% pt
Funding and Liquidity Ratios
The Group’s liquidity and funding positions remained robust with the average all-currency liquidity coverage ratio (LCR) at 135% and net stable funding ratio (NSFR) at 125%, well above the minimum regulatory requirements.
135 %
- 11% pt
125 %
+ 14% pt
Total CAR
Capital Adequacy Ratio (CAR)
As at 31 December 2020, the Group’s capital position remained strong with Common Equity Tier 1 (CET1) ratio and Total CAR at 14.7% and 18.4% respectively, well above the Monetary Authority of Singapore’s minimum requirement. This will enable the Group to steer through macro uncertainties ahead and to drive growth when market sentiment improves.
14.7 %
+ 0.4% pt
Total CAR
18.4 %
+ 1.0% pt