Banks - Singapore: 1Q26 wrap – Wealth resilience offsets NII pressure; AQ stable for now

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Banks - Singapore: 1Q26 wrap – Wealth resilience offsets NII pressure; AQ stable for now

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Banks - Singapore

1Q26 wrap – Wealth resilience offsets NII

pressure; AQ stable for now

Price Objective Change

Fee‑led resilience cushioned ongoing NII/NIM pressures 11 May 2026

1Q26 results for Singapore banks were broadly resilient, with wealth management and Equity

non‑interest income increasingly offsetting NII/NIM pressures. OCBC and DBS were ASEAN | Singapore

better positioned this quarter, leveraging strong wealth fees and trading income to Banks

cushion margin compression, while UOB lagged on non‑II but guided to a clearer pivot Sukriti Bansal >>

toward wealth from 2Q26 onwards. Across the sector, NIMs continue to drift lower in a Research Analyst

declining rate environment; however, capital positions remain strong and AQ is stable for Merrill+65 6678Lynch0454(Singapore)

now, with management remaining cautious amid macro and geopolitical uncertainties. sukriti.bansal@bofa.com

Aiden Chionh >>

Transition from rate‑led to fee‑led earnings further reinforced: with NIM pressure Research Analyst

Merrill Lynch (Singapore)

largely moderating, earnings momentum is increasingly shifting from rates to fees, +65 6678 5539

reinforcing wealth management as a key pillar of valuation support. Strong capital aiden.chionh2@bofa.com

buffers, contained AQ, and improving fee mix keep sector risk‑reward broadly attractive.

Post results, we tweak FY26E–28E EPS for DBS and OCBC down by 1–2% on slightly Exhibit 1: PO summary

softer NIM assumptions, while raising UOB by ~2% as it seeks to better defend margins. Reiterate Buys on UOB, OCBC

Our PO for OCBC rises 2% to S$23.50, while DBS and UOB POs remain unchanged. We

PO Pot. Yld. P/B P/E