KUALA LUMPUR: Alliance Bank Malaysia Bhd
's net profit rose by 9% to RM537.59mil in the financial year ended March 31, 2019 from RM493.23mil a year ago.
It announced on Wednesday its revenue increased by 3.2% to RM1.62bil from RM1.57bil.
“For FY2019, the board of directors has proposed a second interim dividend of 8.2 sen. This brings the total dividend for FY2019 to 16.7 sen per share. The dividend payment ratio is 48%,” said CEO Joel Kornreich.
“Net interest income rose 8.9% on-year, stemming from stronger loans growth and improved loan mix from better risk adjusted return loans. Net interest margin gained 10 bps on-year to 2.50%, and return on equity (ROE) improved to 9.9% (FY2018: 9.5%),” it said.
Aliance Bank said the group’s better risk adjusted return loans increased 27.3% while the lower risk adjusted return loans contracted by 5.6%.
The better risk adjusted return loans expanded to 43% of the overall loan portfolio when compared to 36% in the previous year. This portfolio expansion was primarily due to Alliance ONE Account (AOA), SME, commercial and unsecured consumer loans.
Profit before tax within the consumer banking segment was RM80.5mi, with net income increasing by 1.5%, mainly due to higher net interest income from the success of the AOA segment.
Operating expenses grew by RM36.5mil or 11.0% compared to the previous year. Allowance for expected credit losses for loans, advances and financing increased by RM33.7mil.
The business banking segment's profit before tax grew by 14.6% or RM52.3mil to RM409.4mil in FYE2019. Net income improved by RM42.6mil or 6.3% mainly due to higher net interest income from the successful SME banking expansion and other operating income.
Profit before tax in the financial markets segment increased by 2.1% to RM232.7mil. Net income rose by 2.3%. Operating expenses grew by 5.2%.
The stockbroking and corporate advisory services segment recorded higher loss before tax by RM32.5mil compared to FYE2018.
The losses were due to lower brokerage income and goodwill impairment arising from lower projected cash flows from the reassessment of expected future business performance in the light of current trading and economic conditions.
In the fourth quarter, Aliance Bank group's net profit slipped by 1% to RM111.77mil from RM112.87mil. Its revenue was slightly lower at RM403.44mil compared with RM403.53mil. Earnings per share were 7.2 sen compared with 7.3 sen.
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