Wealth ambitions, AI threats and war risks: 4 takeaways from Singapore banks’ Q1 results

[SINGAPORE] Another quarter, another results season wrapped up for Singapore’s trio of local lenders.

DBS, UOB and OCBC all posted earnings that beat street expectations for the first three months of 2026, even as lower interest rates continued to weigh on net interest income.

DBS on Apr 30 posted a net profit that edged up 1 per cent to S$2.93 billion. On Thursday (May 7), UOB reported a 4 per cent decline in net profit to S$1.44 billion. OCBC, which released its results a day later, reported that its net profit rose 5 per cent to S$1.97 billion.

Several themes stood out: wealth income becoming a bigger earnings driver, rising concerns over AI-related cyber threats, and closer scrutiny on the potential fallout from the Middle East conflict.

And as competition ramps up, bank hiring is another one to watch.

Here are four key takeaways from their latest earnings briefings:

1. Wealth income took centre stage

Fees from wealth management and other non-interest income were a key bright spot among the local banks, helping to cushion earnings as declining interest rates weighed on their margins.

For DBS, wealth management fees reached a record S$907 million, helping to offset a 5 per cent decline in group net interest income.

It also reported “particularly pleasing” growth in Taiwan, with wealth management fees up 30 per cent in the market, DBS chief executive Tan Su Shan said at the Apr 30 earnings call.

OCBC, whose wealth management fees climbed 34 per cent to S$422 million, went a step further. In the same week it reported earnings, it announced the acquisition of HSBC’s wealth and retail businesses in Indonesia.

The deal is expected to drive cost and revenue synergies, while strengthening OCBC’s wealth ambitions in the region, said group chief executive Tan Teck Long on Friday.

For UOB – despite a decline in net fee income – gross wealth fees rose 2.8 per cent to S$219 million.

The lender aims to double its wealth management income by 2030, as it looks to deepen its reach in the affluent segment across Asean, said deputy chairman and chief executive Wee Ee Cheong on Thursday.

2. AI risks are moving up the agenda

Questions on leading artificial intelligence (AI) firm Anthropic’s Claude Mythos model, and its potential cybersecurity impact on Singapore’s banks, featured at all three earnings briefings.

On May 5, Senior Minister of State for Digital Development and Information Tan Kiat How said in Parliament that the chief executive officers of major financial institutions in Singapore have met the Monetary Authority of Singapore to discuss collective action against cyberthreats posed by advanced AI models such as Mythos.

All three bank leaders said their teams were aware of the potential risks.

DBS’ Tan noted that while Mythos can be used by attackers to detect vulnerabilities faster, it can also be used by banks and cyber teams to identify the same vulnerabilities.

“The immediate task at hand is to make sure that you’ve got all the patches, (and) you have your strong internal hygiene, inside and out,” she added.

3. Middle East risks are being watched

The banks reiterated that they do not have material loan exposure to the Middle East.

Stress tests have been conducted repeatedly and remain ongoing, the three chief executives said. They also indicated that existing provision buffers are sufficient for unexpected scenarios.

But beyond the direct impact – or what they described as the “first-order” impact – it is the secondary and tertiary effects that are keeping lenders watchful.

These include inflationary pressures and a potential drag on regional economic growth from elevated oil and energy prices, which management teams flagged as key risks to monitor.

UOB, because of its exposure to loans to small and medium-sized enterprises, continues to run stress tests in this area

Wee reaffirmed the bank’s commitment to small-business owners, saying that the lender will “stand by” its clients and that it is “not the time to de-risk” from them.

4. Hiring will be selective

As all three banks look to grow wealth-management income to offset pressure from lower interest rates, their leaders indicated that they intend to step up hiring in related areas in 2026, including relationship managers.

In 2025, the three lenders posted year-on-year declines in staff count, with their combined employee figures falling by almost 3,000 positions, The Business Times reported before the start of banks’ earnings season in April.

In 2026, however, hiring for wealth-related roles may not necessarily translate into a sharp rise in group headcount. This is because staff numbers in other functions could fall correspondingly, leaving overall headcount broadly stable.

For instance, UOB’s Wee said the bank is using AI tools to automate certain job functions such as those in call centres, though the lender stressed that any reductions in staff count would be managed over time through natural attrition.