BANK NEGARA POSTS HIGHER RM7.56B PROFIT

Central bank declares RM2.5b dividend to government

BANK Negara Malaysia posted a higher net profit of RM7.56 billion in the year ended December 31 2018 from RM7.51 billion previously.

This was despite Bank Negara recording a lower total income of RM9.33 billion, compared with RM10.04 billion in 2017.

It had declared a RM2.5 billion dividend to the government, said the central bank in its annual report yesterday.

“As audited and certified by the auditor general, the financial position of Bank Negara remained strong last year,” it said, adding that its total assets amounted to RM447.6 billion.

Bank Negara said it was exempted from paying income tax and supplementary income tax.

It only had RM21 million in tax expenses last year related to unclaimable withholding taxes on income from foreign dividend and interest and capital gains taxes on sale of foreign investments. On the capital position of banks, Bank Negara said it remained strong last year.

The banks also continued to record healthy profits, largely supported by income from financing activities and continued efficiency gains, said Bank Negara in its Financial Stability and Payment Systems Report 2018.

Commercial banks posted pretax profit of RM36.82 billion, up 1.5 per cent from RM35.32 billion in 2017.

Investment banks’ pre-tax profit fell 98.4 per cent to RM458.3 million from RM909.20 million in 2017.

Islamic banking pre-tax profit edged up 12.88 per cent to RM7.67 billion from RM6.68 billion in 2017.

For the overall banking system, Bank Negara said it pre-tax profit had grown at a slower pace, contributing to slightly lower annual returns on assets and equity.

“The slower profit growth was mainly due to higher provisions set aside by banks with the implementation of Malaysian Financial Reporting Standards 9 and an increase in interest expenses on deposits, in line with the Overnight Policy Rate hike in January,” it added.