Hong Leong Bank FY19 net profit at RM2.66bil

Group managing director and CEO Domenic Fuda said financial year 2019 (FY19) was challenging, with ongoing funding cost pressure coupled with global economic challenges and cautious business sentiment.

KUALA LUMPUR: Hong Leong Bank Bhd’s (HLB) net profit rose by 1% to RM2.66bil in the financial year ended June 30,2019 from RM2.63bil a year ago amid a challenging year.

The banking group, which is controlled by tycoon Tan Sri Quek Leng Chan, rewarded shareholders with a proposed dividend of 34 sen a share.

In a filing with Bursa Malaysia, the bank said its revenue was RM4.72bil compared with RM4.84bil previously, mainly supported by the healthy growth in loan book.

Group managing director and CEO Domenic Fuda said financial year 2019 (FY19) was challenging, with ongoing funding cost pressure coupled with global economic challenges and cautious business sentiment.

“Total income and net profit after tax for the year stood at RM4.73bil and RM2.66bil, respectively, attributable to expansion in loan book and continued outstanding asset quality complemented with consistently strong contribution from our associates.

“This is achieved through a mix of strategic and tactical decisions that leaves us confident moving forward that we can improve our net interest margin, especially off the back of such commendable growth in our loan book without compromising asset quality, ” he said.

HLB said for FY19, gross loans and financing expanded by 6.6% year-on-year (y-o-y) to RM137.6bil, ahead of the industry. Its solid asset quality with gross impaired loan ratio enhanced to a record 0.78%.

The bank, which is the fifth largest lender by assets, maintained a robust capital position with Common Equity Tier-1, Tier-1 and Total Capital ratios at 13.1%, 14.1% and 16.3%, respectively.

In the fourth quarter, its net profit increased by 1.6% to RM636.45mil from RM626mil a year ago. Revenue dipped by 0.76% to RM1.17bil from RM1.18bil. Earnings per share were 31.11 sen compared with 30.60 sen previously.

Hong Leong Financial Group Bhd – the parent company of HLB – posted a net profit of RM1.92bil for FY19 versus RM1.91bil a year ago. However, revenue fell to RM5.28bil from RM5.35bil in FY18.

For the fourth quarter ended June 30, net profit increased 3.17% y-o-y to RM468.7mil as opposed to RM454.29mil previously, backed by higher revenue of RM1.34bil versus RM1.32bil in the same period a year ago.