AFG sees lower earnings, revenue for 2QFY17
KUCHING: Alliance Financial Group Bhd ( AFG) registered lower earnings and revenue for the second quarter of financial year 2017 (2QFY17) ended September.
The banking group in a filing to Bursa Malaysia yesterday said 2QFY17 earnings dipped by 1.5 per cent year-on-year (y-o-y) to RM132.58 million from RM134.66 million recorded in 2QFY16 ended September 2015.
AFG noted 2QFY17 pre- tax profit declined by 2.8 per cent y-o-y to RM175.59 million from RM180.63 million recorded in 2QFY16.
Its second quarter revenue decreased by 1.7 per cent y-o-y to RM359.72 million from RM365.91 million generated in 2QFY16.
Meanwhile, AFG in a statement said its net profit for 2QFY17 remained flat quarter-on-quarter ( q- o- q) at RM132.6 million as compared to RM132.47 million in 1QFY17 ended June 2016.
The group’s better risk adjusted return (RAR) loans grew at the annualised rate of 13.8 per cent over the past six months, while lower RAR loans contracted 0.5 per cent.
On another note, AFG’s net interest margin (NIM) remained stable at 2.22 per cent q-o-q.
The group’s small and medium enterprise ( SME) loans grew strongly at 14.0 per cent y-o-y, with excellent gross impaired loans ratio of 0.8 per cent.
AFG noted its overall gross impaired loans ratio stood at 0.9 per cent against industry’s average of 1.6 per cent.
Moreover, the financial institution said its loan to deposit ratio and current account, savings account (CASA) ratio remained strong at 84.6 per cent and 32.9 per cent respectively.
Its capital position continued to be healthy with total capital ratio of the group at 16.8 per cent.
Commenting on the group’s latest financial results, chief executive officer ( CEO) Joel Kornreich said, “We continue to deliver good financial results because of our strategy of focusing on risk adjusted returns, effective risk management measures and optimisation of balance sheet mix.”
“Our SME loans grew 14.0 per cent and net interest margins improved to 2.22 per cent y-o-y.
“Quarter-on-quarter, our loan to deposit ratio and loan to fund ratio improved to 84.6 per cent and 81.5 per cent respectively, while our CASA ratio remains steady at 32.9 per cent.”
“The group’s total capital ratio remains healthy at 16.8 per cent versus 13.6 per cent a year ago.
“The group’s return on equity for the first half of the (financial) year was 10.9 per cent.
“Net assets per share improved to RM3.27, from RM2.98 a year ago.
“We declared an interim dividend of 8.5 sen per share, representing a dividend payout ratio of 50 per cent,” Kornreich said.
The group’s overall net income for the first- half of the year improved by 1.9 per cent y-o-y to RM723.5 million, while net interest income for the six month period, inclusive of Islamic Banking, improved by 3.6 perv cent y-o-y to RM554.2 million.
Moreover, the group’s client based fee income for 2QFY17, which includes fees from Islamic Banking, grew 13.7 per cent y-o-y to RM77.7 million due to higher trade fees and banking services fees.
Higher wealth management fees, foreign exchange sales, trade fees and banking services fees also delivered significantly improved client-based fee income of 14.8 per cent y-o-y to RM154.6 million.