UOB Earnings: Preemptive Provision Sends Profit Down; We Lower Our Fair Value Estimate by 5%

UOB's third-quarter operating profit declined by 16% year on year, largely driven by lower net interest income. Net profit declined 72% as the bank made an SGD 615 million preemptive general allowance provision. As such, the third-quarter return on average shareholders' equity is weak at 3.5%.