Maybank net profit passes RM2bil
CEO expects a pickup in business and market sentiment
PETALING JAYA: Malayan Banking Bhd‘s (Maybank) net profit crossed RM2bil in the third quarter ended Sept 30, 2017 (3Q17) and it is seeing a pickup in business and loan growth as well as market sentiment.
Group president and CEO Datuk Abdul Farid Alias said the banking group’s strong franchise and resilient balance sheet enabled it to ride through the challenging period over the last few quarters.
“We are now seeing a pickup in business and loan growth as well as market sentiment, which we intend to leverage further in the coming months.
“However, in the midst of this more positive outlook, we are conscious of the heightening pressure on interest margins owing to the increasing cost of funds. While we remain focused on building our core franchise for the long term, we will ensure that we price our assets and liabilities appropriately to ensure continued profitability,” he said in a statement.
The country’s largest banking group by assets reported that its net profit rose 12.9% to RM2.02bil from RM1.79bil in the same period a year ago.
The profits were up 22.2% from 2Q17.
Its revenue increased by 2.7% to RM11.59bil from RM11.28bil for the quarter. Earnings per share was at 19.86 sen compared with 17.97 sen previously.
Profit before tax rose 19.3% to RM2.68bil from 2Q17’s RM2.24bil and was up 9% from a year ago.
Net operating income rose 6.8% year-on-year (y-o-y) to reach RM17.29bil. Growth was from across all business sectors led by group community financial services, which registered an 8.6% rise, group insurance and takaful 2.8%, and group global banking 0.9%.
Its revenue increased by 1.1% to RM33.79bil from RM33.41bil for the nine-month period.
Group gross loans saw a steady expansion, rising 5.3% on-year for the nine months to RM485.9bil, driven by a 6.6% rise in Malaysian operations and 3.7% in international operations.
“This helped boost net fund- based income by 11.7% to RM12.47bil from RM11.16bil in September 2016, which more than offset a 4.3% dip in net fee-based income,” it said.
Group deposits increased by 2.7% y-o-y, led mainly by the Malaysian operations which grew by 7.5% and Indonesian operations by 3%. Maybank pointed out that the continued growth in current account savings account (CASA) helped maintain the group’s CASA ratio at a stable rate of 36.8%.
Its liquidity position was strong with a liquidity coverage ratio of 137% from 136% a year earlier, well above Bank Negara’s minimum requirement of 80% for 2017.
Its net interest margin rose 12 basis points (bps) to 2.39% compared with December 2016.
“However, it was two bps lower than the 2.41% in 2Q17, reflecting the increasing pressure on margins owing to the rising cost of funds,” it said.
Net impairment losses dropped significantly in the third quarter, coming in 51% lower at RM409.6mil compared with RM835.7mil in 2Q17.
Shares in Maybank closed five sen higher to RM9.25 yesterday.