Singapore, Jan 30, 2026, 14:51 SGT — Regular session
- UOB shares dropped 0.6% on Friday, while Singapore bank stocks showed a mixed performance.
- MAS left policy unchanged but lifted its inflation forecast for 2026, rattling some risk bets.
- Attention shifts to UOB’s Feb. 24 earnings for clues on margins and credit costs.
United Overseas Bank Ltd (UOB) shares dipped 0.6% to S$38.41 on Friday, slipping 24 Singapore cents from Thursday’s finish. Trading remained uneven following a solid rally in local banks. The stock fluctuated between S$38.40 and S$38.65. Meanwhile, DBS dropped 0.8% and OCBC inched up 0.2%. 1
The pullback is significant since Singapore’s banks have been carrying much of the weight for local equities. Investors are now wrestling with how “higher for longer” inflation could impact earnings, trying not to get ahead of themselves on valuations.
This comes as the earnings season is about to heat up. UOB won’t report for several weeks yet, but investors are already focusing intently on guidance—particularly around loan quality and the direction of margins.
On Thursday, the Monetary Authority of Singapore held its exchange-rate policy steady but raised its 2026 core and headline inflation forecasts to 1.0%–2.0%, up from 0.5%–1.5%, citing upside risks to growth and inflation. OCBC economist Selena Ling described the central bank’s tone as “a tad more hawkish and less dovish,” while Maybank’s Chua Hak Bin noted “simmering inflation pressures emerging.” 2
Brokers pushed prices higher, only to pull them back again. According to The Business Times, UOB’s consensus target price climbed to S$37.26, even as the stock lingered above that mark after hitting a record S$39.50 last week. Macquarie’s Jayden Vantarakis labeled UOB a “catch-up play,” while JPMorgan downgraded its rating to “underweight.”
Traders see it plainly: the rally already baked in plenty of good news, so minor changes in the macro outlook can spark profit-taking. UOB’s Friday move felt more like repositioning than a reaction to new company developments.
Feb. 24 is the next key date. UOB announced in an exchange filing that it will publish its full-year 2025 financial results ahead of the market open that day. 3
Investors are keenly eyeing any shift in the bank’s forecast for net interest margin — the difference between earnings on loans and expenses on deposits — along with updates on credit costs and fee income. Signals about dividends will also draw attention, especially following the stock’s strong rally this month.
UOB has flagged a potential dip in margins as the rate cycle shifts. Back in November, the bank forecast its full-year 2026 net interest margin to land between 1.75% and 1.80%, which is lower than its 2025 estimate. It also projected total credit costs to range from 25 to 30 basis points. 4
There is a downside risk. Should inflation remain stubborn and policy tighten further later this year, funding costs might outpace asset yields. A shaky global economy could also trigger a swift rise in credit provisions, particularly for a regionally-focused lender like UOB.
Investors are now eyeing UOB’s report due Feb. 24, with keen interest in what management reveals about margins and loan stress as 2026 approaches.
