RHB’s Q3 net profit up more than twofold

The Sun (Malaysia) - - MEDIA & MARKETING -

KUALA LUMPUR: RHB Bank Bhd’s net profit for the third quar­ter ended Sept 30, 2016 jumped over twofold to RM505.33 mil­lion from RM229.26 mil­lion in the cor­re­spond­ing pe­riod last year due to lower other op­er­at­ing ex­penses from re­duced per­son­nel costs and higher other op­er­at­ing in­come.

Rev­enue rose 1.6% to RM2.70 bil­lion from RM2.66 bil­lion a year ago.

For the nine months ended Septem­ber 2016, RHB re­ported a net profit of RM1.42 bil­lion, an in­crease of 9.1% over the pre­vi­ous year’s cor­re­spond­ing pe­riod, mainly at­trib­uted to strong growth in op­er­at­ing profit be­fore al­lowances, though this was partly off­set by a jump in im­pair­ment losses for loans and other as­sets.

In­cluded in the cur­rent pe­riod re­sults was a one-off full im­pair­ment on a cor­po­rate bond in Sin­ga­pore of RM253.5 mil­lion in­curred in the sec­ond quar­ter ended June 2016. In 2015, the group in­curred a ca­reer tran­si­tion scheme ex­penses of RM308.8 mil­lion and ben­e­fited from a col­lec­tive al­lowances writ­ten back due to model re­fine­ment on mort­gage port­fo­lio amount­ing to RM131.4 mil­lion. Ex­clud­ing the ef­fects of these one-offs, nor­malised net profit in­creased by 12.4%.

The group’s op­er­at­ing profit be­fore al­lowances in the first nine months of 2016 was un­der­pinned by healthy net fund-based and non-fund-based in­come growth and ef­fec­tive cost man­age­ment.

RHB said the Malaysian bank­ing sec­tor’s growth will re­main mod­est. Cor­po­rate loan growth is ex­pected to be lower and there is on­go­ing con­sol­i­da­tion in the house­hold loan seg­ment. The fi­nan­cial and cap­i­tal mar­ket is ex­pected to be softer and ris­ing pres­sure on liq­uid­ity and as­set qual­ity will af­fect the bank­ing sec­tor.

RHB group man­ag­ing di­rec­tor Datuk Khairus­saleh Ramli said Q3 re­sults showed sig­nif­i­cant im­prove­ment from the pre­vi­ous year’s cor­re­spond­ing quar­ter.

“De­spite our per­for­mance be­ing af­fected by one large im­pair­ment on se­cu­ri­ties and al­lowances on cer­tain cor­po­rate ac­counts, against the­back­drop of a slug­gish global eco­nomic en­vi­ron­ment, our core earn­ings have re­mained re­silient.”

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