Maybank’s Q3 net profit slips
> Down 3.4% from a year ago; CEO says ‘prolonged geopolitical situation’ a key concern
KUALA LUMPUR: Malayan Banking Bhd (Maybank), Malaysia’s largest lender by assets, posted a drop in third-quarter profit on lower feebased income, while its CEO cautioned that the “prolonged geopolitical situation” was a key concern for business.
Smaller rival CIMB Group Holdings Bhd also sounded a cautious note citing weaker regional economies and the US-China trade war, even as it posted higher quarterly earnings on better consumer and commercial banking business.
Maybank’s net profit for the quarter ended September dropped 3.4% from a year ago to RM1.96 billion (US$468 million), lagging the RM1.98 billion average estimate from two analysts surveyed by Refinitiv.
The lender attributed the drop to lower investment and trading proceeds as well as foreign exchange fluctuations.
Insurance claims and allowances for impairment losses also increased, according to its financial statement.
Revenue climbed 4% to RM12.1 billion.
“The prolonged geopolitical situation remains a key concern, as it would influence global growth, including Asia where Maybank has most of its operations,” Maybank group president and CEO Abdul Farid Alias said in a statement yesterday.
“We will remain agile to adjust to rapid market changes, while at the same time look for opportunities for growth, such as in infrastructure financing, wealth management, digital banking and Islamic banking,” Abdul Farid added.
CIMB’s group CEO Zafrul Aziz said his bank would “continue to control asset quality and cost across its businesses” amid global trade tensions.
The country’s No.2 lender by assets posted a RM1.18 billion profit for the third quarter, 4.2% higher than a year ago and above a consensus estimate of 824 million ringgit from four analysts surveyed by Refinitiv. Its revenue, however, slipped 6.3%.
Maybank and CIMB’s net interest income, a key measure of banks’ financial performance, in the third quarter narrowed to 2.3% and 7.3%, respectively.
The mixed results come against a backdrop of a broader weakness in the economy that analysts have cautioned will dampen banking performance.
Malaysia’s economic growth is expected to slow to 4.8% in 2018, from the 5.9% pace a year earlier.
The economy, Southeast Asia’s third largest, grew 4.4% over JulySeptember, its slowest pace in two years.