United Overseas Bank (SGX: U11) Stock: Q3 2025 Earnings Shock, 6% Yield and 2026 Outlook

United Overseas Bank Limited (UOB, SGX: U11) is back in the spotlight after a brutal third-quarter earnings surprise, fresh covered bond issuance and a chunky dividend stream that now translates into a yield of around 5–6% at current prices. As of 2 December 2025, UOB shares trade around S$34.33, roughly 12% below their 52‑week high of S$39.20 and above the recent low of S$29.00, leaving the stock down about 5–6% over the past year. ^[1]

Investors are asking a simple but loaded question: has UOB just “kitchen‑sinked” its problems, turning the stock into a high‑yield value opportunity, or are we seeing early signs of deeper asset‑quality trouble?

Below is a detailed look at the latest news, numbers and forecasts on UOB stock as of 2 December 2025.

Where UOB’s share price stands today

Latest price: about S$34.33 on the Singapore Exchange (SGX), with UOB’s market capitalisation around S$57 billion. ^[2]
52‑week range: S$29.00 (low) to S$39.20 (high). ^[3]
1‑year performance: roughly ‑5–6% over the past 12 months. ^[4]
Valuation: price/earnings multiple around 9.5–9.8x based on trailing earnings. ^[5]
Dividend yield: current indicated yield is about 5.1–5.3% on regular dividends, with some measures putting the trailing 12‑month cash yield higher once special or capital‑return elements are included. ^[6]

On a calendar‑year basis, data from Dividends.sg suggests total cash payouts of about S$2.27 per share in 2025, including both the final 2024 dividend and interim 2025 distributions, implying a headline yield in the mid‑6% range at share prices in the mid‑S$30s. ^[7]

Q3 2025: A 72% profit plunge that shocked the market

UOB’s third‑quarter 2025 results, released on 6 November, are the main reason the stock has been under pressure.

Headline numbers

From UOB’s own performance highlights and subsequent reporting:

Q3 2025 net profit:S$443 million, down 72% year‑on‑year from S$1.61 billion and well below analyst expectations of around S$1.35 billion. ^[8]
Allowances for credit and other losses:S$1.36 billion in Q3 alone, including S$615 million of pre‑emptive general allowances, which management describes as a proactive buffer against macroeconomic and sector‑specific headwinds. ^[9]
Net interest margin (NIM):1.82% in Q3, down from 2.05% a year earlier as lower benchmark rates compressed lending spreads. ^[10]
Operating profit:S$1.86 billion, down 3% quarter‑on‑quarter and 16% year‑on‑year, reflecting softer income as well as higher provisions. ^[11]

For the first nine months of 2025, UOB delivered:

9M 2025 net profit:S$3.27 billion, down 28% versus 9M 2024.
Net interest income: S$7.0 billion (‑3% year‑on‑year), with NIM narrowing by 13 basis points to 1.91%.
Net fee income: S$1.95 billion, up 6%, hitting a new high on stronger wealth and loan‑related fees.
Other non‑interest income: S$1.57 billion (‑12%) as trading and investment income normalised from last year’s high base.
Cost‑to‑income ratio:44.0%, helped by a 2% decline in expenses even as the bank continued investing in regional growth. ^[12]

Balance sheet and asset quality

The dramatic provision build‑up wasn’t driven by a sudden collapse in loan quality, at least not yet, but rather by a deliberate move to “front‑load” allowances:

Non‑performing loan (NPL) ratio: stable at 1.6%.
Coverage: performing loan coverage lifted to 1.0%, while NPA coverage rose to 100%, or 240% including collateral.
Capital:CET1 ratio of 14.6%, still comfortably above regulatory minima, after factoring in interim dividends.
Liquidity: all‑currency liquidity coverage ratio (LCR) around 143% and net stable funding ratio (NSFR) at 116%. ^[13]

From a pure risk‑management standpoint, that’s a fortress‑style move: weaker headline earnings in exchange for a stronger shield against future credit shocks.

2026 guidance: lower margins, modest growth, steady dividends

The Q3 results came with cautious guidance that sets the stage for UOB’s 2026 performance:

Net interest margin 2026: management now projects 1.75–1.80%, down from 1.85–1.90% expected for 2025, reflecting pressure from lower interest rates and narrower spreads. ^[14]
Loan growth: “low single‑digit” for 2026. ^[15]
Fee income: expected “high single‑ to double‑digit” growth, as UOB leans on wealth management, cards and trade‑related business to offset weaker NIMs. ^[16]
Credit costs: targeted at 25–30 basis points in 2026 after this year’s outsized provisioning. ^[17]

Notably, UOB has emphasised that its dividend policy and 2025 final dividend will not be affected by the pre‑emptive allowances booked in Q3. ^[18]

Earlier in the year, UOB also announced a S$3 billion capital return plan, including S$2 billion of share buybacks and a 50‑cents‑per‑share special dividend, alongside a higher final 2024 dividend of S$0.92 (up from S$0.85), after a 9% rise in Q4 2024 net profit. ^[19] This context matters: the bank is deliberately making payouts generous even as it braces for a more challenging margin environment.

New funding moves: GBP750m covered bonds and ESG lending

UOB has been active on the funding and sustainable‑finance front in late 2025.

GBP750 million floating‑rate covered bond

On 1 December 2025, the bank priced GBP750 million (about S$1.3 billion) of floating‑rate covered bonds due June 2029, at SONIA plus 0.52%, issued at 100% of principal and expected to settle on 8 December 2025. ^[20]

Covered bonds are secured by a pool of high‑quality assets (typically mortgages), allowing UOB to raise medium‑term funding at attractive spreads while diversifying its investor base in the sterling market.

Sustainability‑linked subscription loan facility

In October, a Temasek‑backed impact investment firm, ABC Impact, partnered with DBS and UOB on a sustainability‑linked subscription loan facility, converting a conventional fund financing line into a structure where pricing is tied to measurable social and environmental outcomes. ^[21]

For equity investors, these moves underscore two themes:

UOB can still tap wholesale funding on competitive terms despite the earnings wobble.
The bank is trying to grow fee‑generating, sustainability‑linked business, supporting its guidance of stronger non‑interest income in 2026.

How the market is reading Q3: from “problem bank” to “value‑up” candidate

Analysts and commentators are split on what exactly Q3’s huge provisions signal.

Caution versus peers

The Business Times notes that the outlook for UOB is now more cautious than for DBS and OCBC, after UOB’s 72% profit drop and heavy pre‑emptive provisions. By contrast, DBS and OCBC reported more resilient Q3 numbers backed by stronger non‑interest income. ^[22]

A Reuters piece on the sector highlights the divergence: DBS posted only a modest 2% profit decline and hit record total income, while UOB’s earnings tumbled and its share price fell over 3% on the day of the results. Both banks guided for lower margins in 2026, but UOB’s provisioning made its results look far more severe. ^[23]

“Kitchen‑sink” provisions and a potential value story

Other observers argue that the size of the allowances could be a one‑off reset rather than the beginning of a slide.

A Mark To Market column in The Business Times suggests that UOB may be trying to “kitchen sink” its non‑performing loan issues in Q3, drawing parallels with strong Malaysian banks in the 1990s that deliberately built large general provisions. The idea: short‑term pain, but little change to underlying intrinsic value – and possibly a better buffer against downturns. ^[24]
A related Business Times podcast, Banking on the Singapore banks, frames UOB’s surge in allowances as a one‑time reset that could reduce future risk, even though the market understandably punished the stock. ^[25]

From the retail‑investor side, Dr Wealth’s detailed breakdown of the results notes that UOB’s total income actually contracted 8% year‑on‑year in Q3, in contrast to DBS and OCBC, and that the bulk of allowances arose in the Group Wholesale Banking segment, with particular concerns around exposures in ASEAN and China. Even so, the article highlights positives such as robust loan growth, strong trade loans and resilient wealth income, and concludes that long‑term investors might view the current weakness as an opportunity rather than a reason to abandon the stock. ^[26]

Dividends and insider buying: confidence signals

A rich 2025 payout profile

Between final 2024 and interim 2025 dividends – plus components related to the capital‑return package – UOB shareholders are on track to receive around S$2.27 per share in 2025, according to Dividends.sg, implying a yield north of 6% at share prices in the low‑to‑mid S$30s. ^[27]

Other data providers, focusing on “regular” recurring dividends, show an annualised dividend of about S$1.7–1.8 per share, corresponding to a 5–5.5% yield at current prices. ^[28]

Either way, UOB screens as a high‑yield bank stock, especially in a world where global rates are trending lower.

CEO buying S$5.1 million of stock on the open market

Perhaps the clearest vote of confidence came from inside the bank:

On 11 November 2025, Deputy Chairman and CEO Wee Ee Cheong bought about S$5.1 million worth of UOB shares at an average price of S$33.76, adding to an earlier purchase of around S$7.7 million at S$38.65. ^[29]
Simply Wall St notes that insiders have been net buyers over the past year, with no reported insider sales, and estimates insider ownership at about 5.8% of the company, worth roughly S$3.2 billion at recent prices. ^[30]

Large, voluntary purchases by the CEO at prices close to – and above – today’s level are not proof that the stock is cheap. But they are strong alignment signals: management is clearly prepared to suffer alongside shareholders if the thesis goes wrong.

Analyst forecasts and valuation: what the Street is pricing in

Different analyst platforms paint a slightly different picture, but a few themes emerge.

Price targets

TipRanks aggregates six analysts covering SGX:U11 and reports an average 12‑month target of about S$33.6–33.7, with a high estimate around S$38 and a low close to S$30.2. The average implies roughly flat to slightly negative upside versus recent prices around S$34.3. ^[31]
TradingView’s forecast page cites a higher average target of about S$35.8, with a range from S$30.4 to S$40.1. ^[32]
MarketScreener shows individual broker calls shifting in response to Q3 results:
- Macquarie upgraded UOB from Underperform to Neutral with a target price of S$31.91,
- while PhillipCapital and related research arms hold “Neutral” ratings with targets around S$34.60. ^[33]

Taken together, the Street seems to be saying: UOB is not obviously cheap or expensive at current levels. Most models assume modest earnings growth once provisions normalise, lower margins in 2026, and sustained – but not explosive – fee income expansion.

Fundamental metrics

Beyond targets, common valuation snapshots show:

P/E: about 9.5–9.8x trailing earnings. ^[34]
Dividend yield: around 5–5.5% on recurring dividends. ^[35]
Price‑to‑book: near 1x (varies slightly by data provider and timing), which is not distressed for a high‑quality bank but below the premium multiples DBS can command. ^[36]

Several long‑term return analyses have also pointed out that investors who bought UOB five years ago would have more than doubled their money, with one recent piece estimating about 104% total return including dividends, and a separate 10‑year lookback showing similarly strong compounding. ^[37]

Key risks investors are focusing on

Despite the apparent value case, UOB is not risk‑free. Current debates revolve around a few big themes:

Asset‑quality risk in Greater China and trade‑exposed ASEAN sectors
UOB’s hefty Q3 allowances were driven largely by its wholesale banking portfolio, with commentary flagging macro uncertainty and specific concerns in markets such as China and parts of ASEAN. ^[38]
Margin compression as rates fall
UOB explicitly expects its NIM to fall in 2026 versus 2025, continuing the trend already seen this year. That puts more pressure on loan growth and fee income to keep earnings moving upward. ^[39]
Relative underperformance versus DBS and OCBC
The latest earnings season has broken the usual “move in tandem” pattern of Singapore’s big three banks. DBS still trades like the quality growth leader, OCBC is being framed as a cleaner value play, and UOB currently sits in the hot seat with more provisioning noise and lower investor confidence. ^[40]
Macro and regulatory uncertainty
Commentary from Dr Wealth and others warns that evolving trade policies (including US tariffs) and ongoing weakness in parts of China could continue to stress regional credit, especially in sectors like manufacturing and property. ^[41]

For UOB shareholders, the open question is whether Q3’s allowances are truly front‑loaded and conservative, or simply the first step in a longer period of elevated credit costs.

Investment takeaways: is UOB stock attractive at S$34?

Pulling everything together:

The bad news is visible:
The market has fully seen the 72% profit slump, the S$1.36 billion in Q3 allowances and the guidance for lower margins in 2026. Sentiment is understandably cautious, and UOB is no longer seen as marching in lockstep with DBS and OCBC. ^[42]
The balance sheet looks robust:
NPL ratios are still low, coverage ratios are high, CET1 remains strong and liquidity metrics are solid, even after heavy provisions and generous dividends. ^[43]
Income engines beyond NIM are working:
Loan growth remains healthy, wealth and card fees are trending upward, and treasury customer income has hit record levels. ^[44]
Shareholder returns are generous:
Between ordinary dividends, special payouts and buybacks, UOB is returning a significant portion of earnings and capital to shareholders, resulting in an effective cash yield that can clear 6% for the 2025 calendar year. ^[45]
Insiders are buying, not selling:
The CEO’s multi‑million‑dollar purchases near current prices, and the meaningful insider ownership stake, are supportive signals for investors who care about alignment. ^[46]

At current levels, UOB looks like a classic high‑yield, moderate‑growth bank with a temporarily ugly earnings print. Whether that translates into attractive long‑term upside depends on your view of two things:

How conservative the Q3 provisioning really is, and
How rough the next credit cycle in ASEAN and Greater China will be.

For investors comfortable with Singapore’s banking system, willing to stomach some volatility and focused on dividend income, UOB may well deserve a place on the watchlist alongside DBS and OCBC – particularly if you believe Q3 marked a “clean‑up” rather than the start of a trend.

For more growth‑oriented or risk‑averse investors, the relatively muted analyst upside and uncertainty around asset quality may justify waiting for clearer signs that margins and credit costs are stabilising.

Either way, UOB has moved from a “boringly reliable” bank stock to one of the more interesting value‑versus‑risk puzzles on the SGX.