SINGAPORE, Jan 11, 2026, 15:05 (SGT) — Market closed
- Late Friday, UOB revealed a modest on-market share buyback
- Shares finished mostly flat, keeping the spotlight on capital returns
- Traders are focused on rate expectations and upcoming earnings announcements
United Overseas Bank (UOB) repurchased and cancelled 38,000 shares on Friday, according to a filing with the Singapore Exchange. The bank paid between S$36.01 and S$36.21 per share, shelling out roughly S$1.37 million. This continues a steady pace of buybacks as the year unfolds. (SGX Links)
This matters because bank investors have been focusing on capital returns—dividends and buybacks—while anticipating the next move in interest rates. UOB’s buybacks may be modest on a daily basis, but they reinforce the idea that shrinking share counts can help boost earnings per share when revenue growth hits a lull.
Rates are the other factor in play. For lenders, the crucial figure is net interest margin — the difference between what banks earn on loans and what they pay on deposits — which usually tightens when benchmark rates drop.
UOB shares ended Friday at S$36.02, edging up 0.03% from the prior close. The stock fluctuated between S$36.01 and S$36.24 during the session. Trading volume hit roughly 2.49 million shares, according to Yahoo Finance data. (Yahoo Finance)
UOB’s market team suggests Singapore’s borrowing costs might be hitting a bottom. Peter Chia, UOB’s senior foreign exchange strategist, told a bank webinar that interest rate hedging opportunities lie mainly in the first half of 2026. “We are not so far away from the low,” he said, according to The Straits Times. He was discussing SORA, the Singapore Overnight Rate Average, which underpins many floating-rate loans. (The Straits Times)
These buybacks are part of a broader capital-return effort UOB unveiled last year, which included both a share buyback and a special dividend within a S$3 billion plan to return excess capital. Following that announcement, UOB shares briefly touched a record high of S$39.20. (Reuters)
Investors haven’t had it easy. UOB flagged in its third-quarter update that net interest margin for 2026 is expected to dip to 1.75%–1.80%, pressured by lower benchmark rates narrowing lending spreads. The bank also detailed credit-cost forecasts while bolstering provisions against potential downside risks. (Reuters)
Technicians will spot UOB trading near the S$36 mark again after a volatile year: data sources list its 52-week range between about S$29.00 and S$39.20. The previous peak still stands as a key resistance if the sector’s rally picks up. (Investing)
UOB frequently moves in tandem with DBS and OCBC, with the trio’s shares reacting sharply to changes in rate-cut expectations and shifts in credit market sentiment.
But buybacks won’t hold up if the downside hits fast. A quicker-than-expected pace of rate cuts, a drop in loan demand, or another spike in credit costs could easily swamp the limited boost from daily repurchases and bring earnings momentum back into doubt.
Traders are now eyeing the U.S. Federal Reserve meeting set for Jan. 27-28. This session could shift the consensus on where rates head in 2026. (Federal Reserve)
Investors focused on UOB are eyeing the upcoming earnings report and any clues on margins, credit costs, and buyback speed; TipRanks’ market calendars peg the release date near Feb. 19.
