Operating income was lower by 1.6% while improved cost controls brought about a 2% decline in operating expenses.
KUALA LUMPUR: CIMB Group
Holdings Bhd's subsidiary CIMB Thai posted lower net profit of 554.4mil baht (RM70.71mil) in the nine months ended Sept 30, 2017 due to higher provisions for non performing loans (NPLs).
CIMB Thai, which is 94.11% owned by CIMB Group, reported on Thursday the 9M2017 net profit fell 30.6% on-year due to a 9.8% on-year rise in provisions due to higher NPLs compared to end September 2016.
“Operating income rose by 145.3mil baht to 9.838bil baht mainly contributed by net interest income and net fee and service income growth,” it said.
Its net fee and service income saw a 21% increase on-year due to higher advisory, mutual funds and hire-purchase fees.
CIMB Thai also recorded a decline in interest expenses and hence pushed net interest income up by 266.7mil baht or 3.6%.
“Net interest margin (NIM) over earning assets strengthened to 3.88% for 9M2017 (cf.3.76% in 9M2016) due to better funding cost management.
“Lower equivalent gross non performing loans (NPL) ratio of 5.7% compared to 6.1% as at Dec 31, 2016 mainly due to the sale of some NPLs in 1Q17, more efficient risk management policies and improved asset quality management and loan collection processes,” said the bank.
Elaborating on the results, CIMB Thai Bank PCL president and CEO Kittiphun Anutarasoti said during the 9MFY17, the group’s consolidated operating income rose by 145.3mil baht or 1.5% year-on-year to 9.838bil baht from the previous corresponding period.
The higher income was mainly due to a 3.6% growth in net interest income and a 21.0% growth in net fee and service income, while other income declined 32.8%.
The pre-provision operating profit increased 0.6% on-year to 4.406bil baht from higher income and a 2.3% on-year growth in operating expenses.
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