UOB junior staff to get a one-off extra month’s bonus to cope with rising living costs

SINGAPORE: On Thursday (22 Feb), UOB released a statement announcing that the bank would provide junior employees with an extra month’s bonus on a one-off basis, a move echoing similar initiatives by local counterparts DBS Bank and OCBC Bank.

The bank will disburse an additional month’s bonus to approximately 6,000 employees across its group, with 600 situated locally in Singapore.

UOB’s operational footprint extends beyond Singapore to encompass Malaysia, Thailand, Indonesia, and Greater China.

This decision aligns with recent counsel from Singapore’s National Wages Council, advocating for measures to cushion the impact of rising living expenses on employees.

During a results briefing on 22 February, UOB’s chief executive, Wee Ee Cheong, underscored the vulnerability of junior staff to escalating living costs, stating, “We always ensure that our pay and benefits to all employees are fair and market competitive.”

The move will cost UOB less than S$10 million, The Straits Times (ST) reported.

UOB also emphasized that its compensation structure extends beyond wages, incorporating a sustainable suite of perks and benefits, including enhanced medical coverage and training opportunities.

“The Group is committed to ensuring that the wage structure of its employees is fair and competitive, complemented by a comprehensive range of perks and benefits that are sustainable for the long-term, including enhanced medical support, training programmes and more,” the bank stated.

In addition to the one-off payment for its junior staff, UOB has also disclosed that its core net profit for the 2023 financial year (FY), concluding on 31 December 2023, soared to a historic high of S$6.06 billion, marking a remarkable 26% surge from its core net profit in FY2022, which stood at S$4.8 billion.

According to UOB, the reported core net profits for 2023 do not encompass the one-off expenses associated with the acquisition of Citigroup’s consumer banking operations in Malaysia, Thailand, Vietnam, and Indonesia, which amounted to S$350 million.

Even after factoring in these expenses, the bank’s net profit surpassed S$5.7 billion, constituting another record pinnacle for UOB.

In tandem with this robust performance, the bank’s board has proposed a final dividend payout of S$0.85 per ordinary share, resulting in a total dividend of S$1.70 per ordinary share for FY2023.

UOB notes that this equates to a payout ratio of approximately 50%.

Wee Ee Cheong, Deputy Chairman and Chief Executive Officer of UOB, said that “strong income growth through a diversified business franchise” had fueled the record core net profit.

He added that although the global economic outlook remains “uncertain,” Southeast Asia remains a “bright spot.”

“We are optimistic about ASEAN’s potential, driven by improved domestic demand, robust tourism recovery and strong investment flows into the manufacturing sector as companies reconfigure their supply chains.”

Earlier this month, OCBC revealed that approximately 4,600 junior employees in Singapore, constituting approximately 40% of its local workforce, would each receive a S$1,000 payout in either February or March.

Similarly, on 7 February, DBS announced a one-time bonus of S$1,000 for its junior staff, who represent half of its global headcount of about 40,000 employees.

Over 5,500 employees in Singapore are slated to benefit from this payout, while those stationed outside Singapore will receive a bonus indexed to local purchasing power parity.