UOB falls most since May on surprise lending margin squeeze

(Oct 26): United Overseas Bank fell the most in almost five months after a key gauge of loan profitability fell, overshadowing higher third-quarter net income at the Singaporean lender.

The stock slid as much as 3.8% on Friday, the biggest intraday decline since May 30. The 2 basis-point drop in net interest margin in the three months ended September from the previous quarter was “the biggest disappointment” in the results, said Marcus Chua, an analyst at Nomura Holdings Inc.

UOB is the first Singapore bank to report earnings for the period, and the results may indicate a softer patch during the second half of the year, dominated by Asia’s slower economic expansion and volatile financial markets.

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