Singapore’s largest banks deliver a mixed report card on profits amid looming rate cuts and U.S. tariffs threats

Ore Huiying—Bloomberg via Getty ImagesSingapore’s biggest banks are bracing for macroeconomic uncertainty ing a mixed quarterly results

DBS, Southeast Asia’s largest bank, dered a good quarter

On Thursday, the bank reported fits of 2.82 billion Singapore dollars ($2.2 billion) for the quarter ending June 2025, a 1% increase year-on-year that beat consensus estimates

Yet fellow Singaporean bank UOB, which released its quarterly results on the same day, reported a 6% drop in quarterly fit to 1.34 billion Singapore dollars ($1.04 billion) as net interest income weakened

OCBC, which reported last week, also had its quarterly fit decline by 6% to 2.34 billion Singapore dollars ($1.82 billion)

As with UOB, falling net interest income weighed on OCBC’s performance

The three banks, the largest by revenue in Southeast Asia, are not only grappling with declining interest rates, but also warning of a more uncertain economic outlook

In a statement, UOB CEO Wee Ee Cheong expressed confidence in Southeast Asia’s long-term spects despite global polarization

UOB has the greatest exposure to Southeast Asia among the three major Singaporean banks. “As the global landscape transitions towards a multipolar world order, ASEAN continues to demonstrate resilient growth

With regional integration, trade diversification and rising foreign direct investments, ASEAN is well-positioned to thrive in the evolving global economy,” Wee said in the statement

Yet UOB’s CEO also warned that new U.S. tariffs could dampen consumer sentiment and investment activity

Outgoing OCBC CEO Helen Wong also highlighted a challenging macroeconomic outlook in her earnings statement last week. “Evolving trade and monetary policies, and persistent geopolitical tensions are expected to weigh on growth spects,” she said

DBS CEO Tan Su Shan, speaking after her first full quarter as the bank’s new CEO, acknowledged “external uncertainties,” though added that “active management” of the balance sheet will help DBS navigate the interest rate cycle

The European Union and China started to ease their monetary policies last year as well

The Monetary Authority of Singapore, the city-state’s de facto central bank, also loosened its monetary policy earlier this year

Banks fit from higher interest rates by earning more on loans and attracting additional deposits

Beyond falling interest rates, Singapore’s three banks must also navigate higher U.S. tariffs

Trump’s new tariffs on U.S. trading partners go into effect today

Yet Singapore’s neighboring economies got it much worse

Other Asian economies got it worse

While tariffs won’t directly affect DBS, UOB, or OCBC, a broader tariff-driven economic slowdown will dampen consumer sentiment and curb investment activity, reducing opportunities for Singapore’s globally-connected banking sector.