Malayan Banking Bhd (Maybank)
has reported a 4.2% rise in group pre-tax profit to RM704mil from RM675.5mil for the third quarter ended March 31.
On a nine-month basis, the group registered a 3.4% rise in pre-tax profit to RM1.95bil from RM1.88bil in the corresponding period last year.
Group profit after tax for the nine months rose 3% to RM1.37bil, compared with RM1.33bil previously. And earnings per share rose to 38.38 sen, up from 37.56 sen.
However, revenue was down marginally to RM7.09bil from RM7.18bil in the year-ago period.
The third-quarter group pre-tax profit was boosted by higher net interest as well as non-interest income, the group said in a statement yesterday.
OSK Research assistant general manager Pankaj Kumar said Maybank's latest results were within market expectations.
On the marginal rise in group pre-tax profits reported by Maybank and by Public Bank Bhd on Monday Pankaj said loans growth in the banking industry was expected to slow this year; and more banks' bottom lines were expected to benefit from lower loan loss provisions, given the level of non-performing loans (NPLs) was trending down.
Meanwhile, online investment advisory Surf88.com said investors should look at loans quality rather than loans growth rates.
In the case of Maybank, it's not so much about loans growth. The more important issue is loans quality, and that is reflected quite well in its latest results,'' it said.
At the bank level, pre-tax profit during the quarter was RM499.5mil compared with RM609.4mil a year ago, due to lower dividends received from subsidiaries, as well as higher overhead expenses, which mainly comprised the cost of introducing chip-based automated teller machine cards.
Group profit after tax for the current quarter was RM468.6mil, against RM578.2mil in the corresponding period last year mainly due to the higher effective tax rate incurred in the quarter compared with 2002. And for the bank, it was RM331.4mil against RM555.8mil previously.
On a segmental basis, Maybank's commercial banking group reported a pre-tax profit of RM1.38bil for the nine-month period, up nearly 9% from RM1.27bil, while its insurance group reported a 77% jump in pre-tax profit to RM50.9mil, compared with RM28.8mil previously.
However, Maybank saw declines in its investment banking group. Nine-month pre-tax profit stood at RM68.3mil, down 29% from RM96.6mil. Its finance group also saw lower pre-tax profit contribution this year, dropping 10% to RM439.7mil from RM490.4mil previously.
Maybank said the improvement in its insurance group was attributable mainly to the stronger performance of the general insurance business, which saw better underwriting results in the retail segment.
The investment banking group's results were affected by the challenging equity markets conditions, while Mayban Finance's results were impacted by the narrowing interest margins on hire-purchase loans.
The group, however, continued to record strong loans growth as well as improvement in asset quality, which was reflected in a further decline in NPLs.
Loans and advances by the group grew 5.5% on an annualised basis for the nine-month period to March 31, reaching RM109.4bil from RM105.1bil to June last year.
Strong loans growth also continued to be registered in both the small- and medium-sized industries (SMIs) and consumer financing sectors,'' Maybank said.
In domestic operations, loans to SMIs grew at an annualised rate of 11%, while overall trade financing for corporates and SMIs grew 19%. In consumer financing, the group saw mortgages grow 7.4%, motor vehicle financing 19.1%, and credit card receivables 26.4%.
The group said its risk weighted capital ratios remained strong despite the record dividend payout of 35 sen per share made during the quarter in review. Maybank's group capital adequacy ratio as at end-March stood at 14.11%, and that for the bank at 12.96%.
Maybank expects to maintain its showing during the final quarter to June 30, 2003.
No dividends were declared for the quarter in review.
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