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25 Aug 2017
The Star : AMMB posts slightly higher Q1 net profit
 
AMMB posts slightly higher Q1 net profit
Business News
Friday, 25 August 2017


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AmBank group chief executive officer Datuk Sulaiman Mohd Tahir(filepic) said that the banking group was pleased to kick off the new fiscal year with an improved profit before provisions of RM429.1mil.

PETALING JAYA: AMMB Holdings Bhd (AmBank), whose proposed merger with bigger rival RHB Bank Bhd was aborted three days ago, posted a firmer set of financial results with profitability and revenue slightly higher in the first quarter ended June 30, underpinned by business banking, transaction banking, global markets and mortgages.

The bank’s first-quarter net profit rose 1.6% to RM328.27mil from RM323mil in the same period a year ago.

Revenue, meanwhile, inched up just 0.8% to RM2.08bil from RM2.06bil. Earnings per share stood at 10.92 sen compared with 10.74 sen previously. 

AmBank group chief executive officer Datuk Sulaiman Mohd Tahir said that the banking group was pleased to kick off the new fiscal year with an improved profit before provisions of RM429.1mil.

“Our results were driven by encouraging topline growth, particularly in business banking, transaction banking, global markets and mortgages,” he said in a statement.

Sulaiman said the banking group’s loans and financing base recorded a modest growth of 2% year-to-date (YTD).

Its business banking loans base grew 4.6% YTD, as well as mortgages going up 4.3% YTD.

He added that AmBank had also pushed ahead to grow the lucrative small and medium-sized enterprise (SME) segment, with the newly set up enterprise business centres and dedicated new SME segment hunter teams to drive growth in loans for that segment.

“In line with the group’s four-year strategy, we undertook a planned reduction in corporate fixed deposits, which saw a 1.95% YTD contraction.

“This contraction was cushioned by higher retail and cash management current accounts, which fuelled the 2.2% YTD expansion in current accounts and savings accounts. We see transaction banking maintaining good growth momentum and healthy cash management pipelines,” he said.

Sulaiman pointed out that the banking group’s higher net interest income was driven by lending growth in targeted segments, while net interest margin stood at 2.02%.

Going forward, he said that the banking group was currently focusing its investments on growth areas.

For instance, on a on-quarter basis, expenses fell 5.1% whilst cost-to-income improved 1.6%, as it kept a tight rein on operating cost.

“In terms of asset quality, the group’s credit cost is normalising with lower recoveries and writebacks on performing loans. Gross impaired loan was stable at 1.88%, in line with the previous fiscal year.