To The Moon

Singapore’s three local banks are showing different rhythms in July. DBS just hit another all-time high near S$45, continuing its leadership. OCBC has surged for six straight sessions, rising past S$16.50 and hitting its highest level for the year. Meanwhile, UOB is still lagging, trading around S$36 and below its previous February high.

With DBS looking stretched after a long bull run, attention is shifting toward OCBC and UOB. Which one offers better value for the rest of 2025?

OCBC – Momentum and Wealth Angle

OCBC’s recent rally reflects renewed interest from investors. Its private banking arm continues to benefit from inflows, especially from North Asia. With strong capital ratios, OCBC also has flexibility for more dividends or even buybacks if growth slows.

Its loan book is slightly more defensive when interest rates decline, with a tilt toward trade finance and mortgages. However, after six straight green sessions, the stock may take a breather. It also lags peers in fee income, which means it is more reliant on net interest margins and wealth inflows to drive earnings.

UOB – Yield and Value Play

UOB may not have the recent excitement of OCBC, but it offers the most attractive dividend yield among the three. Its expansion into ASEAN via Citi’s consumer banking units is now largely complete, and the full benefits may be seen in the second half of the year.

Its valuation remains compelling on both price-to-book and forward PE. However, costs related to integration remain elevated, and UOB lacks the scale in wealth management that DBS and OCBC enjoy.

Strategy Considerations

If you like momentum, OCBC may still have room to run — especially if it breaks above key resistance levels. For income-focused investors or those seeking value, UOB looks attractive, especially for those willing to wait for a potential rerating.

Some investors may choose to split exposure between the two: OCBC for near-term upside, UOB for medium-term revaluation and dividend stability.

Conclusion

DBS has been the clear outperformer, but fresh upside from here may be more difficult unless Q2 earnings exceed expectations. With OCBC gaining momentum and UOB offering yield and value, there’s a good case to rotate or diversify exposure among the two.

If Singapore’s economic backdrop remains stable and rate cuts are not too aggressive, both OCBC and UOB could reward investors in the second half of 2025.