Public Bank Q2 profit rises 4.8%
Net profit rises 4.8% to RM1.4bil on higher net interest income
PETALING JAYA: Public Bank Bhd’s operations continue to improve, with a net profit increase of 4.8% to RM1.40bil in the second quarter ended June 30, compared with RM1.33bil in the corresponding quarter last year.
The positive results led the third-largest banking group by assets in Malaysia to declare a first interim dividend of 32 sen per share, or a total payout of RM1.24bil.
Public Bank’s shares rose eight sen to close at RM24.48 yesterday.
In its filing with Bursa Malaysia, Public Bank attributed the improved earnings for the quarter in review to a higher net interest income, improved income from the Islamic banking business, lower loan impairment allowance and higher net fee and commission income, which were partially offset by lower investment and other operating income.
During the quarter in review, Public Bank’s earnings per share (EPS) rose to 36.13 sen from 34.49 sen in the previous corresponding period.
The group’s revenue grew 5.2% to RM5.44bil in the second quarter of 2018 from RM5.17bil in the previous corresponding period.
In total, Public Bank’s net profit for the first half of the year saw a growth of 8.6% to RM2.80bil from RM2.58bil in the six months ended June 2017. Consequently, its EPS rose to 72.53 sen from 66.81 sen previously.
During the first half, the group’s revenue grew 5.8% to RM10.76bil from RM10.20bil previously.
Public Bank founder and chairman Tan Sri Teh Hong Piow said the group’s encouraging year-to-date performance was mainly attributable to its loan and deposit business.
“The group was able to sustain good business momentum in the first half of 2018. The higher profit for the period was largely driven by growth in its loan and deposit business, with further impetus from a 4.9% growth in non-interest income.”
In the first half, Public Bank group’s total gross loans rose by an annualised rate of 4.1% to RM310.7bil. On the domestic front, loan growth stood at 4.3% to RM288.3bil, driven primarily by mortgage lending and commercial lending to small and medium enterprises.
On deposit taking, Public Bank group’s total customer deposits grew at an annualised rate of 6.7%, led by the resilient growth in domestic deposits which increased at an annualised rate of 7.4%.
“Sustained business strength continued to place the group in a strong competitive position, with its net return on equity standing at 15%.
“The group’s cost-to-income ratio of 33.1% and gross impaired loans ratio of 0.5% remained the best when compared to the Malaysian banking industry’s gross impaired loans ratio of 1.6%,” Teh said.
As at end-June 2018, the group’s gross loan-tofund and equity ratio stood at 79.4%.
Its common equity tier-1 capital ratio, tier-1 capital ratio and total capital ratio stood at 12.7%, 13.4% and 16.3%, respectively.
Public Bank said its non-interest income segment remained a main source of revenue for the group, with contribution increasing 4.9% yearon-year during the first half, driven mainly by the group’s unit trust business as well as stable growth in its banking transactional fee income.