Updated: 13 December 2025
United Overseas Bank Limited (UOB) — SGX: U11 (Reuters: UOBH.SI) — is ending 2025 with investors focused on three big questions: how fast net interest margins will compress in 2026, whether credit costs stay contained after a sharp spike in provisions, and how much support shareholders get from ongoing capital returns. Recent headlines on covered bond issuance, a capital security call, and a subsidiary liquidation have added extra texture to the story — but earnings and interest-rate expectations remain the core drivers.
UOB share price today: where the stock stands (Dec 13, 2025)
UOB shares last closed at S$34.72 on the Singapore Exchange, up about 1.3% on the day in local trading. [1]
On MarketScreener’s data snapshot, UOB was also shown at S$34.72, with a year-to-date change of -4.43% as of Dec 12 (market closed). [2]
That “down on the year, but stabilising late in the year” pattern reflects a tug-of-war between:
- Margin pressure expectations (a headwind as rates drift lower), and
- Shareholder returns + valuation support (a tailwind if dividends/buybacks remain strong).
What’s new this week: the key UOB stock headlines investors are watching
1) UOB’s sterling covered bond deal: £750 million priced, due June 2029
UOB priced £750 million of floating-rate covered bonds due June 2029 under its US$15 billion Global Covered Bond Programme. The coupon was set at compounded daily SONIA + 0.52%, with the issue expected to be dated 8 December 2025, and the bonds expected to be rated Aaa (Moody’s) / AAA (S&P). [3]
A Reuters report carried by TradingView added important colour on demand and pricing: the spread was cited at 52 basis points over SONIA, with final orders around £850 million, allowing UOB to upsize from an initial £500 million. The report also said the pricing level was the tightest this year for a non‑UK issuer on a curve-adjusted basis, and that the deal produced estimated spread savings versus senior unsecured funding. [4]
Why it matters for the stock: covered bonds are typically cheaper funding than senior unsecured debt because investors have dual recourse (to the bank and to the cover pool). Cheaper, more diversified funding can help cushion profitability if loan margins tighten.
2) UOB’s euro covered bond deal: €850 million, 2.718%, due 2030
Just before the sterling deal, UOB priced €850 million of 2.718% fixed-rate covered bonds due 2030, with the issue expected to be dated 1 December 2025. The announcement also referenced expected ratings of Aaa / AAA. [5]
Taken together, these back-to-back European covered bond transactions highlight UOB’s active approach to balance-sheet and funding optimisation late in the year.
3) Corporate action: early redemption (call option) on a S$150m perpetual capital security
SGX corporate action records show an issuer’s early redemption (call option) event for “UOB S$150M 2.25% Perp Cap Sec” (ISIN SGXF91929004), with a payment date of 15 January 2026 and a redemption rate of 100%. [6]
This is not the same thing as an equity buyback — it’s a capital instruments housekeeping item — but it’s still relevant because it affects capital structure and can be a signal of capital management flexibility.
4) Subsidiary liquidation: “Union (2009) Limited” placed into members’ voluntary liquidation
A filing distributed via SGXNet channels stated that UOB’s subsidiary Union (2009) Limited commenced members’ voluntary liquidation, described as part of ongoing group operational rationalisation, and the notice said it was not expected to have a material impact on group earnings for the financial year ending 31 December 2025. [7]
For most equity investors, this reads as a simplification move rather than a profit driver — but it helps reduce organisational clutter, which banks tend to accumulate the way old ships accumulate barnacles.
The bigger driver: Q3 2025 earnings shocked — but management framed it as “insurance”
The largest single catalyst shaping UOB sentiment into year-end remains its third-quarter 2025 result.
Reuters reported UOB’s Q3 net profit fell 72% year-on-year to S$443 million, primarily because the bank booked S$1.36 billion in credit allowances, including S$615 million in pre-emptive general allowances. [8]
In that same reporting, UOB projected its 2026 net interest margin (NIM) at 1.75%–1.80%, down from the bank’s 2025 projected 1.85%–1.90%, alongside low single-digit loan growth, high single- to double-digit fee income growth, and total credit costs of 25–30 basis points. [9]
The key nuance: the provisions were widely interpreted as “front-loading” credit caution — raising buffers while the bank can — rather than a claim that the core franchise suddenly broke. Still, markets tend to penalise uncertainty around credit quality, even if the bank argues it’s being conservative.
How 2025 evolved: Q1 caution, Q2 slip, Q3 provision spike
To understand why the margin narrative matters so much, it helps to track 2025’s arc.
- Q1 2025: Reuters reported UOB posted S$1.49 billion net profit (roughly unchanged year-on-year) but paused 2025 guidance due to uncertainty around U.S. tariffs, while noting a 2.00% net interest margin in Q1. [10]
- Q2 2025: Reuters reported a 6% year-on-year decline in Q2 net profit to S$1.34 billion, attributed mainly to lower net interest income, and the figure missed estimates. [11]
- Q3 2025: Profit plunged mainly due to the allowances build, while the bank guided to lower 2026 margins. [12]
Net-net: investors are reading UOB as a well-capitalised franchise entering a less friendly rate environment — with management choosing to prioritise resilience (buffers) even at the cost of ugly quarterly optics.
Dividend and buyback support: why income investors still keep UOB on the radar
UOB’s shareholder-return narrative is still one of the more supportive pillars under the stock.
Earlier in 2025, Reuters reported UOB announced a S$3 billion capital return package, including a 50 Singapore cent special dividend in 2025 and a S$2 billion share buyback programme, alongside a final 2024 dividend of 92 cents per share (up from 85 cents the prior year). [13]
UOB’s investor relations materials also emphasise a longstanding commitment to dividends, describing an intent to balance shareholder returns with resources required to build a sustainable business. [14]
Separately, MarketScreener’s dividend history for UOB shows multiple dividend entries in 2025, including an interim payment of S$0.85 and an “other dividend” entry of S$0.25 in August, plus a final payment of S$0.92 and “other dividend” S$0.25 earlier in the year. [15]
The practical takeaway: UOB remains structurally attractive to investors who prioritise income and capital discipline — but the sustainability of that appeal depends on how earnings behave as NIM compresses.
UOB stock forecast: what analysts are projecting for 2026
Consensus expectations for UOB are currently clustered around “modest upside, but not a screaming bargain.”
MarketScreener’s consensus page shows:
- Mean analyst stance:OUTPERFORM
- Number of analysts:15
- Average target price:S$35.83
- High target:S$40.10
- Low target:S$30.40
- Implied upside vs last close (S$34.72):~+3.21% [16]
TradingView shows a similar picture, citing a price target of S$35.97 and a range from S$30.40 to S$42.00 (based on its stated analyst set). [17]
In plain English: analysts aren’t predicting disaster — but they also aren’t pricing in a big rerating unless something changes (rates, credit costs, or growth).
Next major catalyst: UOB’s next earnings date
MarketScreener’s calendar lists a projected Q4 2025 earnings release on 18 February 2026. [18]
That report will likely be treated as a referendum on whether Q3’s allowances were a one-off “buffer build” or the start of a higher-loss phase.
What could move UOB stock in 2026: the four levers that matter most
1) Net interest margin compression: the headline risk
UOB itself has warned that 2026 NIM may decline to 1.75%–1.80%. [19]
For bank stocks, a falling NIM tends to do two things:
- It pressures net interest income (especially if deposit pricing doesn’t reprice down as fast as asset yields), and
- It forces investors to revalue the “steady compounder” story unless fee income or volume growth offsets the squeeze.
2) Credit costs and asset quality: “provisioning as strategy” only works if losses stay contained
UOB’s Q3 allowances were framed as pre-emptive. [20]
Investors will watch whether:
- NPL formation (non-performing loans) stays controlled, and
- the bank can revert to “normal” credit cost levels consistent with its 25–30 bps guidance. [21]
If realised losses begin to chase the provisions higher, the narrative shifts fast — from prudent to pressured.
3) Fee income growth: a key offset if margins shrink
UOB has pointed to high single- to double-digit fee income growth expectations for 2026. [22]
If that shows up in wealth management, cards, transaction banking, and markets activity, it can partially “de-bank” the earnings mix — making the stock less rate-sensitive.
4) Capital returns and funding optimisation: buybacks/dividends and lower-cost funding can stabilise sentiment
The capital return package (special dividend + buyback plan) remains a key support in the bull case. [23]
Meanwhile, December’s covered bond deals underscore a focus on efficient funding and investor diversification — a quieter driver, but one that matters more when margins are tight. [24]
The bull vs bear debate on UOB stock right now
Optimists see:
- A leading ASEAN banking franchise with disciplined capital management,
- A willingness to take pain early (provisions) to protect the balance sheet, and
- Income appeal reinforced by dividends and buybacks. [25]
Skeptics point to:
- A clear margin downshift signalled by management for 2026, [26]
- Uncertainty around the “true” credit cycle after Q3’s allowances surge, [27]
- And only limited implied upside in consensus targets near current prices. [28]
Bottom line
As of 13 December 2025, UOB stock is trading in a zone where valuation support and shareholder returns are doing real work — but the market is demanding proof that UOB can navigate 2026 margin compression without a sustained deterioration in asset quality. The next major inflection point is likely the Q4/FY results window in February 2026, when investors will look for evidence that Q3’s provisioning was a strategic reset rather than a warning siren.
References
1. www.businesstimes.com.sg, 2. www.marketscreener.com, 3. links.sgx.com, 4. www.tradingview.com, 5. links.sgx.com, 6. links.sgx.com, 7. classic.shareinvestor.com, 8. www.reuters.com, 9. www.reuters.com, 10. www.reuters.com, 11. www.reuters.com, 12. www.reuters.com, 13. www.reuters.com, 14. www.uobgroup.com, 15. www.marketscreener.com, 16. www.marketscreener.com, 17. www.tradingview.com, 18. www.marketscreener.com, 19. www.reuters.com, 20. www.reuters.com, 21. www.reuters.com, 22. www.reuters.com, 23. www.reuters.com, 24. www.tradingview.com, 25. www.reuters.com, 26. www.reuters.com, 27. www.reuters.com, 28. www.marketscreener.com
