Good morning, welcome to UOB's First Quarter 2023 Results briefing. I'm Wendy Wan from the Group Strategic Communications team, and I will be your MC for today. This morning, we have Mr. Wee Ee Cheong, UOB Deputy Chairman and CEO, and Mr. Lee Wai Fai, our CFO, to present the results. A few house rules before we start. Please keep all your questions till after the presentations are done. We would like to remind those in the room with us to put your mobile phones to silent. For those of you on Microsoft Teams, please put yourself on mute for now. Without further ado, I will now pass the time to our CEO. Mr. Wee, please.
Good morning. Thank you for joining us today. We had a strong start to the year. Our core net profit for the quarter grew to a record SGD 1.6 billion, up 74% year-on-year. Our diversified engines across the region in retail and wholesale businesses have done well. Core ROE rose to 14.9%. Net interest income was up, boosted by higher margins. Other non-interest income also surged, with record high trading and investment income offsetting softer fee income. Core cost-to-income ratio improved to 40.9% as we stayed disciplined. Asset quality was resilient with credit costs within expectations. Recently, there have been pockets of banking instabilities in the U.S. and Europe. This created some volatility in global financial markets and added to concerns over the global growth outlook. The liquidity and stability of banks came under the spotlight.
UOB is a safe and trusted bank with strong AA ratings. As a prudent long-term player with strong balance sheet is important to us, that we can continue to support our customers through market cycles. On the back of robust earnings, we took the opportunity to further strengthen our balance sheets. Our CET1 improved to 14%, our liquidity profile is well above regulatory minimum. Let me share some highlights on our core business segments. Group retail performed well, supported by our balanced business model. A bright spot here is wealth management. Wealth management fees recovered strongly, hitting the highest levels in four quarters and are expected to increase as market sentiment improve. AUM grew 14% year-on-year or SGD 6 billion this quarter, almost all from net new money.
Credit card fees almost double, 93% year-on-year, due to contributions from the Citi portfolio and significant pickup in consumer spending. As we aim to shore up stable funding, our retail deposit base grew 15% year-on-year. In uncertain times, customers seek a safe harbor, or you can call it flight to quality. We have received increased customer inquiries and inflows across both our wholesale and retail businesses. Now, on the progress of our Citi deal. After Malaysia and Thailand, we completed the acquisition in Vietnam in March. We target to close in Indonesia later this year. We are on track to achieve our projected revenue uplift of around SGD 1 billion from four markets for the full year. Our customer base continued to expand from last quarter. As we scale up our regional franchise, we continue to invest in capabilities and to forge partnerships.
A case in point in our recent tied-up with Lazada, which spans retail and wholesale segment. We will work with our e-commerce partners to offer banking solutions for our combined customer base in five key Southeast Asian markets. Our wholesale business remains strong. Our loan portfolios saw steady new loans draw down, which were offset by repayments. Meanwhile, our regional subsidiaries' loan books are growing well. China reopening could offset some of the global headwinds in the second half of this year. Our margin remains stable with asset repricing mitigating higher funding costs. Our global markets business grew strongly, with customer flow income rising 25% year-on-year in first quarter 2023. The past 12 months, customer flows account more than 60% of our trading and investment income. We continue to boost our capabilities to capture trade and investment flow. We are ramping up our cash management business.
Revenue from our new cash management business year-to-date almost double compared with the same period last year. We actually grew 97%. Average wholesale CASA balance has surpassed pre-COVID levels, up to 62% compared to 2019. Similarly, trade income was up 19% from pre-COVID levels. Our aim is to become the number one cross-border trade bank for ASEAN. As a result of our sustained efforts, transaction banking income has now grown to account for half of total wholesale banking income. We continue to see upside in our connectivity business. Cross-border income grew 19% year-on-year, and the number of suppliers and distributors in our financial supply chain management rose 30% year-on-year. Geopolitical tensions and risk diversifications are driving supply chain shift.
As production hub for the east and west across industries, ASEAN is benefiting, and UOB is gaining new businesses, working with manufacturers coming to this part of the world. Our FDI advisory team has facilitated higher investment flow into this region, up 6.4% for first quarter, from businesses in sectors such as logistics, electric vehicles, infrastructure, renewable energy, biotech, and advanced manufacturing. Meanwhile, our sustainability will continue to work closely with clients on their transition. We signed an MOU with JTC last week to scale the adoption of green solutions among Singapore businesses. Looking ahead, the operating environment remains uncertain. However, we still expect to see growth in Asia. There are opportunities in this region where we have extensive integrated network. China's reopening and recovery will benefit our region. We expect trade and investment flows to improve in the second half of this year.
For this year, guidance remain largely unchanged. We are anticipating low to mid-single digit loan growth with a focus on high-quality customers. Margin to hold up at current levels. Double-digit fee growth from a low base. Costs to remain well managed. Credit costs at 20 to 25 basis points. With our strong balance sheets, we are committed to riding through market cycles with our customers and supporting them in seizing opportunities in our part of the world. We are confident that our diversified franchise will help us deliver balanced and stable growth. I'd like to thank my colleagues for their teamwork and dedication. Now, let me now invite Wai Fai to elaborate on our financial. Thank you.
Yeah. Thank you, Ee Cheong, good morning once again to everyone. Thank you for spending your morning with us. Our core net profit registered another new high of SGD 1.6 billion, like Ee Cheong said, this quarter. Including the one-off expenses relating to the Citi integration, net profit would be SGD 1.5 billion. Net interest income is this quarter due to a shorter day count as well as lower net interest margin. NIM moderated to 2.14%, partly from the liquidity surplus, which we have built, and partly due to the increasing cost of funding. Fees income registered a double-digit growth of 14%, led by the recovery of the wealth fees on the back of improved investor sentiments. Loans fees rebounded from last quarter's low. Card fees held up despite a traditionally softer quarter, boosted by the acquired Citi consumer portfolio.
Treasury and investment income surged to an all-time high, boosted by stronger customer-related treasury income, as well as good performances from our trading and liquidity management activities, which benefited from the market volatility. Cost-to-income ratio, excluding the one-off, improved to 40.9% from strong income growth and disciplined spending. The record quarter profit growth ROE to 14.9%. Asset quality stayed resilient, with NPL ratios unchanged at 1.6%. We have increased our preemptive general allowances, resulting in total credit costs of 25 basis point. Liquidity funding capital positions strengthened further. Our CET1 increased to 14%, a 70 basis point increase over the quarter. On the business front, year-on-year retail operating profit doubled on an enlarged revenue base from the inclusion of the Citi consumer portfolio.
Deposits income surged on wider net interest margin, while credit card activities picked up with the borders reopening. Wholesale saw double-digit growth led by margin expansion and strong customer-related treasury income. Global market benefited from market volatility, but was impacted by the steeper cost of funding. Our retail customer base has surpassed the 7 million mark. Of this, around 77% are digitally acquired. Our Malaysian and Thai customer base, even after the integration, have further expanded during the quarter. The completion of the Citi acquisition in Vietnam is not big for us. It added another around 140,000 customers into the base. Organically, we have also acquired 225,000 customers through the quarter, with almost 60% coming through our digital channels.
Following Citi acquisition, we have been targeting further growth in the multi-market partnership, one of which Ee Cheong just highlighted earlier. Leveraging on our enlarged regional customer franchise, we now have 40 strategic and co-brand partnerships across multiple markets. This is in addition to the more than 1,000 in-country partnerships that we have. Net credit card fees doubled year-on-year in the first quarter, with Citi contributing around a quarter of those increase and also a significant pickup in the consumer spending for the rest of the portfolio. Our asset under management rose 14% year-on-year to SGD 160 billion, mostly from net new money inflows. Partly, like Ee Cheong said, we benefited from the flight to quality. We see opportunities in the wealth business in the near term, as we observed increased customer inquiries and flow recently.
Our omni-channel strategy continued to show good traction. These customers are highly engaged and actually contribute up to three times the higher average revenue as compared to the traditional channel. Our wholesale business remains strong despite the global economic headwinds that soften near-term growth outlook. We continue with our strategy in providing business connectivity across the region. Ee Cheong highlighted some of the numbers in there, and the number of supply chain increasing by 30%. Our global FIG rose 23%, while income outside our real estate, hospitality, and financial institution sectors rose 41%. I mean, we are moving to sectors that are less under stress from the near-term outlook. Across the region, our cash management platform is seeing significant growth in transaction volumes and cashless payment. For the quarter, we continue to see growth momentum in Singapore, the ASEAN Four, and the developed markets.
Singapore recorded exceptionally strong trading and investment income, though this was partially offset by the lower NIM from the deployment of the excess funds into high-quality liquid assets. ASEAN Four's strong performance was boosted by the newly acquired Citi portfolio in Malaysia, Thailand, and Vietnam. For the developed markets, we recovered from last quarter, because last quarter we had some mark-to-market volatilities, and the market stabilized this quarter. On the detailed financials, I think I touched on this. I will skip this and let you read it. On the other indicators, first on net margin. Net interest income rose, sorry, net income is 6% to SGD 2.4 billion due to a shorter quarter as well as lower net interest margin. Following consecutive quarters of sharp increases, NIM moderated 8 basis point to 2.14% this quarter.
Loans margin was impacted by the catch-up in cost of funds, as fixed deposits were progressively repriced at higher rates. Interbank and securities margin increased 9 basis points quarter on quarter as the excess liquidity earned from the expanded deposit base were deployed into this less yielding but still profitable high-quality liquid assets as compared to loans. Fees income rose double digit at 14% Q- on- Q. Wealth management fees picked up after three consecutive soft quarter, signaling a return of investor confidence. Loans-related fees rebounded from last quarter, while card fees continue its growth momentum following the inclusion of the Citi portfolio. Customer-related treasury income started off well, very well this year, setting a new high of SGD 202 million driven by hedging demands.
Trading and liquidity management activities also saw good performances this quarter as we managed to capture the trading opportunities amidst the market volatility. On the back of strong income growth and well-controlled spending, core cost-to-income ratio improved to 14.9%. Including the one-off, this would have been 43.3%. We continue to focus on investments to build capabilities for strategic growth while maintaining our cost discipline. I think on the asset quality, our overall asset quality of our loans portfolio remain resilient. NPA formation was stable and within our expectation, and the NPL ratio was unchanged at 1.6%. On credit costs, specific allowance eased this quarter, with net credit costs improving from 31 to 21 basis points.
In view of the near-term macro uncertainty, we have added preemptive general allowances for this quarter to strengthen our total provision coverage, bringing total credit costs to 25 basis points for the quarter. As of March this year, the group total allowances stood at SGD 4.9 billion, of which SGD 3.3 billion was general allowances. I think our NPL coverage at 96% or 212% after collateral, and more important is the general provision coverage over performing loans improving to 1%. I think these are all very adequate and very defensive balance sheet that we have built. We are confident that our prudent provision coverage will cushion against any potential downside risks from our credit portfolio. Loans growth momentum unfortunately has moderated, declining 1% for the quarter.
Year-on-year, loans grew 1% on a constant currency basis, contributed by our ASEAN Four. With rising cost of funding, we have reduced our reliance on wholesale market and focused on growing our customer deposit franchise. Customer deposits grew steadily at 2% for the quarter and 3% for the year. This quarter, we also managed to reverse the CASA declining trend with CASA deposits mix improving to 47.9%. I think you remember that we are having this pressure, dropping from 50% over. I think we are quite happy that hopefully this will be the start, we have stabilized that trend. Our liquidity position strengthened further this quarter, with LCR at 154% and NSFR at 121%. I think these are all well above regulatory requirement. Our CET1 capital position is solid at 14%.
This is contributed by the strong quarterly earnings and recovery by the mark-to-market valuation, coupled with very tight and efficient RWA management. I think with that, I conclude my presentation. I'll pass it back to Wendy.
Thank you, Mr. Lee. We will now move on to the Q&A. For those present here, if you would like to ask a question, please raise your hand and wait for my cue. For those on Microsoft Teams, please use the Raise Hand function to indicate that you would like to ask a question. Kindly wait for my cue and turn on your camera before asking your question. Please introduce yourself before asking your question. We will start off with those in the room with us. First question, please. First question from Prisca.
Hi. Thanks for the presentation and congrats on the good results. I have three questions. The first on loan growth guidance. It's downgraded from mid-single digit in the fourth quarter. What are some of the major imminent risks you see to loan growth? The second question on the latest ABSD announcement, what is the projected impact you see on housing loan demand? The third question on the interest income, how much do you think it can continue to increase given that rate hikes are tapering and with cuts on the horizon?
Okay, you asked a few questions. Let me answer one by one. Okay. The first one is on the loan growth, right? We are targeting, I think for this year, I think low to mid-single digit. In fact, for this first quarter, I can share with you there is a loan growth of about SGD 30.9 billion. You have SGD 29.8 billion repayments, SGD 4.2 billion partial repayments. It shows customer, because of the high interest rate, customer is happy to pay down the loans. We are generating, but the repayments start to come in. It's something that we cannot control, right? It also shows that our customer portfolio is good. They have the liquidity to repay. Okay?
Moving forward, I think for this year we are still targeting low to mid loan growth. The second one on the just announced, right? I'm just like all of you, I see the headline today. I think long term is good for Singapore. I think Singapore, Singaporeans should feel very happy that the government is protecting us because property is something very strategic long term. Okay? You want to make it more sustainable in the housing market. If you are a first time owner, you actually, there's no change. Okay? The impact will be more to foreigners who come here to buy, and that is only constitute maybe 10% of the market, is what the newspaper say. I think the overall market, I believe it should be quite sustainable. Okay?
As far as UOB is concerned, I think if I can remember, close to 80% of our loan books are owner-occupied. Our loan LTV is about 55%-60%. Right? The repayment is all very good. We always do a stress test for the consumer. At every time today, if they were to borrow, we don't just base on today interest rate. We base on the projected interest rate of 4%, 5%. How would that impact on their repayment capability? I believe the portfolio will continue to stay receiving. What is your last question?
Much, net interest income can continue to increase given that rate hikes are different.
Well, anyway, Wai Fai, I think he's more on top of this. We believe the house view is we are, we see another 25 basis point interest rate hike, and then you will pause. Okay? Hopefully by next year, I would say the rate may not come down. You will continue to hold on for the next one, two years, because inflation is still the main issue. Okay. Wai Fai, you want?
I think there were a few questions that Ee Cheong already answered. For the ABSD, the percentage quoted was market. The UOB percentage for foreigners is actually significantly lower than that. Okay? It is actually a fraction of that, so the impact on us is less, because, like Ee Cheong said, most of us are owner occupied that we are focusing on. The pipeline has been slowing down, which is good because of the government is so worried. I think over longer term, like Ee Cheong said, we believe that it is good for the economy. We do not see housing going to a hard landing that a lot of people are speculating. The last question on NIM, you put things into perspective. We have been having significant growth over the last three quarters.
Mm-hmm.
Okay. If this continues at that same pace, I think there are a lot of worries about effect on credit quality as well. We don't think that it will come down, but I think the moderation of the rate hike, a lot of people are calling for one more in this current Fed. There is unfortunately now some latest thought whether the Fed will actually pull the trigger because of the worry of the domestic banking after what happened to First Republic and SVB. We know that that will actually come down. More important for us is we think NIM will moderate to around this level. We are confident on keeping it between 2.1%-2.2%. If you put things in perspective, we go back last year, my average is 1.86%.
Even I stay at 2.1%, I probably have a 30, 31 basis points to actually buffer my balance sheet. Number two is that we have actually diversified our income besides just margins itself. We have been focusing on fees, and the good news is we saw that momentum coming back. For the wholesale side, we think there will be some weakness in the first half and probably picking up only in the second half, hopefully led by the China reopening. We expect some loans momentum not to be as strong in the first half. We are confident that the fees will offset that and that's probably something that we will really make sure. The integration of Citi, okay, that will give me the earning base as well to cushion myself. Citi is coming in very, very well.
We will get the SGD 1 billion that we promised at the revenue line. In fact, some of the initial indication is we are surpassing some of those. For example, like number of customers. Okay? There was always worry about attrition, drops and all. Like I mentioned, now is, we are already after the integration, number of customers continue to grow on both sides.
Yeah.
Okay? There is growth on both sides of the customer. That signals the confidence customer has with us, with our portfolio. If we get our multi-countries partnership in place, that will really strengthen our position as a key ASEAN player in the consumer space. Those are few that we are a little bit confident that we will be able to hold up my income line. Okay? Margin might moderate, hopefully offset. Like I said, we gave up some margin because of liquidity. We actually went in, and you think about it, my loans growth was -1%. My deposit growth was 2% up. There's definitely some excess, and we wanted to do it to protect our balance sheet.
Yeah.
Okay.
No, I think, I think this is a key point, right. Because we are a long-term player here, right. The profit is good. You just don't look at margin, right. It's the liquidity that we are worrying. You look at the world outside there. Okay. I mean, we cannot sit here and believe that everything is rosy, right. We have to anticipate all these problems. Liquidity is the key. Right. That is one thing. We are happy to make sure that the balance sheet is strong. We rather sacrifice a bit of NIM. It's okay. If you look at the Citibank portfolio when we acquire, we anticipate the attrition rate, right, to be about 10%. Actually, today, after we merge, it's actually up 3%, right.
You look at the Thailand portfolio, you look at Malaysian proper, it shows the people are willing to accept us. More than willing, right? The growth is there. It's a good thing. As what my CFO say, we can anticipate a lot of growth out of Citi portfolio. We are using technology. Our TMRW, we started six years ago. We are using our digital to engage our customer. Citibank portfolio is basically how credit card and unsecured. Given our capability of doing both secured mortgage and wealth, we are actually cross-sell a lot of this customer base to our region. Hopefully, the earning will be much more than what we anticipate.
Thank you. Can we take the next question?
Yes. Hi.
From Bloomberg.
This is [crosstalk] from Bloomberg. Just going back, thank you for sharing on new property measures. Can you talk a little bit about price? Do you think that property prices in Singapore will soften this year after the measures? I have three questions. Second question, you talk about wealth flows and inquiries from customers. Can you say how much net new money have you received, and any from Credit Suisse? My third question, Credit Suisse AT1 bond sale is quite a big issue in Singapore and globally. Did UOB sell Credit Suisse AT1 bonds? Thank you.
Yeah. I think your first question is whether housing prices, home price will come down. Very difficult for me to predict. You know, Singapore today, the fact is it reflects the government is very confident when they want to introduce this measure, right? The demand is there. Singapore is a AAA country, right? People are willing to come and make a strategic move. I hope that will sustain, stabilize a little bit. Even if it have to come down a little bit, I think it's generally quite good, because that is part of the inflation measure that the government is trying to, right? Housing is a big-ticket item, right? Not just housing price per se, but you affect a lot of other things. The demand for higher salary, you make Singapore less competitive.
That is my thought. I think I would see flat or maybe slower a little bit, right? For the AUM, I mentioned in my speech, we're up by SGD 6 billion, okay? I can't tell you how much is from Credit Suisse, but I think it's a very unfortunate thing. I welcome competition, right? Competition is always good and healthy, okay? I believe most of the player will benefit from that. Third thing was, what is the?
Maybe I'll, maybe I take that, Ee Cheong.
Yeah.
Did we sell Credit Suisse AT1 portfolio? We did, but middle of last year, that was 2022, we actually had advised customers to get out of that portfolio because we don't look at return, we look at wealth preservation. We are not comfortable with what we see. We literally went out and advised all customers to switch on. There's a very small fraction who thinks that they are better than the average bear that wants to hold on, but majority have already switched out. Our impact is actually very minimal.
Yeah.
That's great. Very prudent. Thank you.
Thank you, [Tanya]. Any more question? [Goola], please.
Yeah. I've got a question on the because of the bank's capitals in the overseas, in Europe, et cetera. I'm just wondering, what is the ideal capital mix between CET1, AT1, and Tier 2? what is the CET1 you need to maintain your AA? because of course all of you have a lot more CET1 if the Pillar 3, then you have the Tier 2.
Okay. I think MAS put a limit to how much we can put in CET1, AT1, and total capital. Okay? There is a limit they put in above which it wouldn't be counted in that sense. The AT1 and the Tier 2 are roughly around 2%, okay? That's the limit set by MAS, which means that majority of it have to be in your core equity Tier 1. We are way below those min-limits on AT1, probably because of the strong CET1 that we have. Correct. Turned out that rating agencies, actually both the regulators and rating agencies, put a lot of focus on that which we can't disclose. To maintain our AA rating, and we are one of the few in the world, in fact, and three of them are concentrated in a small island like Singapore.
There is a lot of focus to make sure that we maintain our capital strength, both by the regulators and the rating agencies. We are comfortable to say is that we are guiding that a bit higher, that we will keep it above 13%. I think with that will give me a prudent mix between growth, dividend, okay, growth and the capital equity ratio, the CET1 that we talked about. That's probably something that we are watching. Obviously the worry about CET1, I mean, in my mind they have all eased. I mean, we're very worried about this a few quarter ago because of Citi and all.
Mm-hmm.
We did a lot of RWA management. Of course, the bonus came out was the interest rate went up now.
Mm-hmm.
If the interest rate didn't go up, I would have moved back to 13% by end of this year. The interest rate helped me. Okay? That means I'm one year ahead of what, two years actually, ahead of what we want to be. That is probably where we are. With this, we are extremely comfortable that I can go back to my organic strategy to focus if the market and the wholesale part can grow, we will support that.
Your CET1 group, because you put aside your dividend payout was 49% for the full year of 2022.
Yes.
Is it possible to still keep that? I mean.
Yes. Yes.
Of course, your 1Q is SGD 1.6 or whatever, so.
Yeah.
That is our guidance, right? We if as long as our capital is above 12.5 to above 12.5, I think we already articulate to our shareholders that we'll pay 50% of the earning. Yeah.
I guess we are quite clear that if we maintain strong capital, which we are today, and if the outlook don't look at a disastrous outlook, I think we'll pay 50% of it. Technically, I cannot promise, and I don't think I can promise a 74% profit for the year. Okay? Because this quarter is a bit exceptional, but definitely profit will be higher than last year.
Wow.
Technically, you could expect higher dividend per share.
Then credit quality. This quarter was very benign. What do you see, you know, what were the assumptions in your 25 basis points?
Yeah. I think it's still within our guidance of 20%-25%. Right? We noticed there could be some uptick, right? Given the global economy, especially people are watching about some of the major city like U.S..
The commercial real estate.
Mm-hmm.
Our percentage is 2%, which is small, and they are fairly strong sponsor and also fairly well capitalized.
Sorry, just in terms of your.
Portfolio.
Portfolio, there is.
2%.
U.S. 2%.
2% in U.S., yeah.
Maybe just to add to Ee Cheong, the credit cost, like I said, we are comfortable in the long term. In the short term, we might have some NPL uptick, but our portfolio, a lot of those that we are going in is very strong. Of course there is a recent worry about commercial real estate, okay? If you zoom down the commercial real estate, the actual worry is about office space. Because if you look at commercial real estate, you have increased those that build for data centers, et cetera.
Mm-hmm.
They are okay.
Mm-hmm.
Okay? A lot of some of them, they are residential, they are actually fully leased out, they are also okay.
Mm-hmm.
There is a focus on what we call office space, and the worry is on gateway cities, okay? Really, to put it bluntly, is U.S.A.. To be specific, it's the East Coast of U.S. and first.
Mm-hmm.
Okay? Maybe the occupancy in New York. I think we have gone through those. We have one or two that we think are on the fringe, but the good news is that, number one, these are quite heavily collateralized because our LTV is 50% or below.
Mm-hmm.
Number two is they have very strong sponsors. Okay? One or two, actually, the sponsors top up money if they think that the cash flows. We do might have one or two, but my credit cost coming out, even if there's a slight uptick in NPL, my credit cost of 25 basis point is more than enough because, like I said, so we put quite a fair bit of GP, and that's why I'm building up my, I use the other ratio that I call GP over performing loans.
Mm-hmm.
Okay? That means because they are still We think they're still okay, but you don't know how fast it'll be back.
Mm-hmm.
Rather than once they become back, then you set aside, and that's the one that I'm building up. That's the one that you saw that we have been gradually moving from 18, 19 now to 100 basis point. 100 basis point brought me all the way back to even pre-COVID areas. Okay? I don't really need that, but I'm just anticipating the weakness. We do have reserve in there should some of this pocket come out that's over and above what we anticipate.
You still have your management overlays.
I can't tell you, but I actually added management overlays.
You added this quarter?
Yeah.
Okay. Okay. Jonathan here from Forbes. Mr. Wee, could you elaborate on the sources of growth for the AUM? Just wondering whether you're getting new business from the family offices that are coming here to Singapore.
Family office?
Yeah.
Yeah. Partly family office. I would say even corporates, because we are focusing on wholesale, on retail, private wealth. I would say a combination of few sources.
Mm-hmm.
Okay?
Any other questions? From the back.
Mr. Lee, as a follow-up to [Goola's] question earlier, the commercial real estate exposure in the US, how much is UOB's total exposure there?
In the U.S., less than 2%. Office space is.
Less than 2%?
Office space is 1%. You can add.
It's actually very small.
Mm-hmm.
End of the day, as an organization, we are not focusing on some of the western country, right? Whatever balance sheet we put into U.S. to U.K., to all this country is company must have aspiration of coming to Asia. Right?
Right.
This is where we can support them. Ultimately, the real big factor is they are moving to Asia. That fit our overall strategic purpose. We don't just, on a stand-alone, compete with the American bank to look at housing, to look now.
Mm-hmm.
Right? If there is, it's very, very small. Okay? These are all franchise customers.
Maybe a specific question. Office space in New York is less than 1% of the portfolio.
Thank you, Jonathan. Any questions from online? We don't see any hands. Just a reminder, if you want to ask a question, kindly use the Raise Hand function. Any other question? [Goola]?
There is some exposure to some of the Chinese REITs that are listed in Singapore. I mean, I know we can't mention it, but there's some exposure to Chinese real estate. Is that also very well collateralized and?
Yes. Yes. The sponsors are actually very strong.
Okay, the LTVs of this is like.
Yeah.
Is it less than 50?
I think between 50 to 60.
Mm-hmm. Between 50 to 60.
Seems like property is a very hot topic this quarter.
You know, because there's been so many stresses in the property market globally, isn't it? It's not just.
Yes
The U.S., there's some stress in China as well.
Thank you, [Goola]. Any other areas of interest?
Going back to the Citibank question. I'm looking at the geographical segmentation of the income and the loan book. Indonesia is still small, but I assume because you haven't completed the acquisition, I wonder what will be the mix of earnings across the loan book of the group once Indonesia is included. Will it be a big chunk once you complete Indonesia?
The Citibank portfolio?
Yeah.
No, Citibank is, actually in Indonesia is quite small.
Mm-hmm.
The biggest is in Thailand.
Mm-hmm.
Thailand, Malaysia, and then Indonesia and Vietnam. Okay? Indonesia is still way for us to grow. Right? Now that we have the people, we have the technology platform, I think Indonesia is also poised to grow. Immediately, I think the biggest market for us is Thailand and Malaysia.
Thank you, Mr. Wee. Any other questions from the floor? I guess it's another very good quarter for us, since it's another record. Last call for any other questions.
Can I just ask quickly, the increase by 6 billion in AUM, is that in US dollars or it's Singapore dollars?
Mm.
That is Singapore dollars. In the report.
Sing dollars. SGD 6 billion, this is net new money, right?
Net new.
Yeah.
Thank you.
Thank you very much, [Tanya]. Any last comments from Mr. Wee?
No. Anyway, thank you for coming. Whether result is good, no good, but I value your presence. Right? Thank you very much and enjoy your cup of tea or coffee, you say, on the way out.
Yeah.
See if the timing is good.
Thank you, Mr. Wee. Thank you, Mr. Lee. That's all the time we have for today. Thank you for joining us this morning, and we wish you a good day ahead. Thank you.