CIMB banks 45% rise in Q1 net profit
> Record quarterly earnings on noninterest income and lower provisions
PETALING JAYA: CIMB Group Holdings Bhd posted a record quarterly net profit in the first quarter ended March 31, 2017 (Q1), growing 45% to RM1.18 billion from RM813.80 million a year ago driven largely by growth in non-interest income in line with improved capital market activity and lower provisions.
Its revenue jumped 17% to RM4.36 billion from RM3.73 billion in the previous year’s corresponding quarter.
Group chief executive Tengku Datuk Seri Zafrul Tengku Abdul Aziz said CIMB had a good start to 2017, recording its highest ever quarterly net profit in Q1 in tandem with the gradually improving regional economic conditions and capital market activity.
“Our main business units are gaining traction, with cost management initiatives continuing to show progress and asset quality showing sustained improvement.
“Better capital and balance sheet management has brought about more focused growth, improved margins, a healthier CASA (current and savings account) ratio and a strengthened capital position,” he said in a statement.
CIMB’s cost-to-income ratio improved to 52.6% in Q1 with operating expenses staying under control. Loans grew 12.2% on the back of Malaysia loans expanding 11.8% year-on-year in the quarter.
On a year-on-year basis, CIMB’s Q1 operating income expanded 17.1%, translating to a 30% improvement in preprovisioning operating profit. The Q1 net earnings per share stood at 13.3 sen, while the annualised Q1 net return on average equity was 10.3%.
Zafrul said the strong Q1 results are testament to the stronger foundations CIMB has built since embarking on its T18 Strategy. The strong start to the year also provides the impetus for the bank to continue embedding the 5Cs – capital, cost, culture, customer experience and compliance – across all its T18 programmes.
CIMB is cautiously optimistic for the rest of 2017, with more stable economic conditions, increased regional activity, improved capital markets and declining provisions across key geographies.