Against these uncertainties, OCBC was especially vigilant in managing its risks. Detailed efforts were made to sharpen our strategic perspectives to factor in these challenges. This has also resulted in greater clarity on the optimal levels of our capital position for current and future business needs, with prudent buffers to cushion against unforeseen events.

For 2024, we are again pleased to report an increase in the OCBC Group's net profit, despite the fast-changing external operating environment. This reflects the increased traction of our strategies and the realisation of our multi-year capability investments from Management's adroit execution and the Board's effective oversight.

On behalf of the OCBC Board, I want to sincerely thank our shareholders, customers, employees and the communities that host us for their continuing support. Without this, the OCBC Group would not be Southeast Asia's second largest financial services group by assets and consistently ranked within the Top 10 Strongest Banks globally.

Record Financial Results

For the third consecutive year, the OCBC Group reported record net profit, which increased 8% over 2023 to $7.59 billion, with return on equity at 13.7%. This was driven by robust income growth across our comprehensive Banking, Wealth Management and Insurance franchises. The strong earnings performance was complemented by disciplined expense management as reflected in Cost-to-Income Ratio of 39.7%, without compromising our continuing calibrated investments in strategic initiatives and capabilities. Our prudent risk management approach was demonstrated by our sound asset quality, with the Non-Performing Loan ratio at 0.9%. Our capital and liquidity positions remained strong. The MAS' final Basel III reform rules took effect on 1 July 2024, and our 2024 transitional Common Equity Tier 1 Capital Adequacy Ratio was 17.1%, or 15.3% on a fully phased-in basis.

We continued to maintain our position as one of the world's most highly-rated banks, with credit ratings of Aa1 from Moody's and AA- from Fitch and S&P. Further details of OCBC's strong 2024 performance are discussed by our Group CEO, Ms Helen Wong.

Record Total Income

$14.5 billion

7%

Record Net Profit

$7.59 billion

8%

Rewarding Shareholders

$2.5 billion

Capital return over 2 years

60% Total Dividend Payout Ratio

$1.01 Dividend Per Share

23%

Reiterating the value of operating as “One OCBC Group”

As Singapore's longest established bank, OCBC has for decades operated as an integrated financial services group consisting of Banking, Wealth Management, Insurance and Asset Management. This comprehensive and well-diversified franchise is complemented by a deeply entrenched network presence in ASEAN's leading economies of Singapore, Malaysia and Indonesia, as well as in Greater China. Our franchise includes the Bank of Singapore where we offer our Private Banking services. In Indonesia, we operate through our 85.1% subsidiary PT Bank OCBC NISP. We own 93.72% of Great Eastern Holdings, the leading life insurance player in both Singapore and Malaysia, and Lion Global Investors, one of the largest asset managers in Southeast Asia. In China, OCBC has a 20% stake in Bank of Ningbo, recognised as one of the best city commercial banks and ranked 19th largest bank by total assets in China. All these make the OCBC Group unique in its franchise breadth in this region. Together with our subsidiary, Great Eastern Holdings, the OCBC Group has combined assets of $625 billion, making us the second largest financial services group in Southeast Asia.

OCBC's strategic ambition is consistently clear and bold, which is to be Asia's leading financial services partner for a sustainable future. To advance our ambitions, in May 2024, we made an offer to acquire additional shares in Great Eastern Holdings and successfully raised our ownership from 88.44% to 93.72%. This is of clear benefit to OCBC's shareholders, as it further enables the Group to tap into the significant and growing wealth management and insurance potential of our region. This additional stake is immediately earnings accretive and comes without any integration risks, given our deep understanding of Great Eastern Holdings' insurance business as it has been part of the OCBC franchise for decades. In May 2024, we further stepped up our presence in Indonesia through the acquisition of PT Bank Commonwealth. This acquisition helped raise our market ranking by a notch to be the 8th largest bank by total assets in Southeast Asia's largest economy.

As an integrated financial services group with our extensive networks in ASEAN and Greater China, the collective strength as One OCBC Group positions us well to capture more of the rising wealth, investment and trade flows in this region.

Higher Dividends and Proposed Share Buyback

OCBC achieved strong earnings growth in the past three years, aided by a favourable interest rate environment, and stronger traction in the execution of our strategy. As stated earlier, we now have greater clarity of our capital position after a rigorous review of investment options available to us. This included putting aside initial thoughts of a possible redevelopment of our Singapore headquarters complex, as well as declining certain potential inorganic opportunities due to strategic fit.

We are therefore pleased to set out a comprehensive approach to return $2.5 billion of capital over two years through special dividends and share buybacks. OCBC will continue to retain our robust capital position even with this capital distribution back to our shareholders.

We plan to distribute this $2.5 billion of capital through special dividends set at 10% of the Group's annual net profits for 2024 and 2025, with the balance targeted for return via share buybacks. Together with our target ordinary dividend payout ratio of 50%, this means that our total dividend payout ratio for 2024 and 2025 will be 60% per annum, the highest by OCBC in over 15 years.

For 2024, the Board has recommended a final ordinary dividend of 41 cents per share, and a special dividend of 16 cents per share to initiate our capital return plan. Together with the interim dividend, total dividends for 2024 will add up to $1.01 per share. This represents a payout ratio of 60% against 2024 net profit, and a yield of 7.0% against OCBC's 2024 average share price.

Ensuring Best Outcomes through Strong Governance

Across the OCBC Group, our various Boards and Management undergo continuous renewal to ensure the right mix of skillsets and experience. At OCBC Bank, we welcomed Mr Lian Wee Cheow who joined as an Independent Director in January 2025. We would like to express our gratitude to Ms Christina Ong, who retired in February 2025 after nine dedicated years of service.

We would like to recognise Mr Tan Ngiap Joo, who retired as Chairman and Director of OCBC Malaysia in September 2024. Mr George Lee Lap Wah was appointed Chairman in his place, and we also welcomed Dato' Shamsuddin Bin Mohd Mahayidin to the OCBC Malaysia Board. At Bank of Singapore, we thank Mr Lai Teck Poh for his leadership during his tenure as Chairman. We welcomed Mr Tee Fong Seng, a veteran private banker, to the Bank of Singapore Board in January 2025.

In 2024, we continued strengthening our senior leadership team with two new appointments to the Group Management Executive Committee: Mr Praveen Raina, Head of Group Operations and Technology, and Ms Elaine Heng, Group Chief Strategy and Transformation Officer. At Great Eastern Holdings, we welcomed Mr Greg Hingston, who was appointed CEO in November 2024.

The Strongest Bank in Singapore, 5th Strongest Bank in Asia Pacific and 10th Strongest Bank in the World

The Asian Banker's 1000 World's Strongest Banks

Bank of the Year – Asia Pacific, Indonesia and Malaysia

The Banker Magazine Bank of the Year Awards

Best Private Bank for Digital Wealth Planning – Bank of Singapore

Global Private Banker Wealthtech Awards

Best Retail Bank – South East Asia and Singapore

The Digital Banker's Global Retail Banking and Innovation Awards

China International Trade Finance Bank of the Year

Asian Banking and Finance

Best Risk Management (Big Cap – Gold)

Singapore Corporate Awards

Education Insurance Initiative of the Year

Insurance Asia Awards

Best Insurance Asset Manager

AsianInvestor Asset Management Awards

Looking ahead

As I write this note, the external environment is decidedly more unpredictable. We operate in uncharted waters. OCBC has survived and thrived through many crises during its 92 years of continuous operations. The Board and Management take inspiration and confidence from this. We have a well-defined corporate strategy, a proven risk management framework and the resources to invest for the future. We remain fully committed to deliver sustained value to our stakeholders.

In closing, I would like to express my thanks to my fellow Board members for their valuable insights and guidance, and to everyone who has been instrumental in driving OCBC’s success.

Andrew Lee
Chairman
February 2025