BIMB records 2Q net profit of RM153.03mil


  • Banking
  • Thursday, 27 Aug 2020

According to BIMB, the weaker performance was owing to the impact of lower net financing income arising from downward revisions of the overnight policy rate and the recognition of a RM97.8mil modification loss due to the moratorium exercise in April 2020.

KUALA LUMPUR: BIMB Holdings Bhd's net profit for the second quarter ended June 30, 2020, slipped 21.6% to RM153.03mil from RM195.16mil in the same quarter last year with lower contributions from its banking and takaful businesses.

Over a six-month period, the group's net profit was 8.6% lower year-on-year (y-o-y) at RM362.26mil versus RM397.68mil previously.

Earnings per share over the period under review was 20.25 sen as compared to 22.69 sen in the previous corresponding period. Group net assets per share rose to RM3.55 as at June 30, 2020, as compared to RM3.34 on Dec 31, 2019.

BIMB's banking arm, Bank Islam Group, recorded a profit before zakat and tax of RM389mil in the first half of 2020, which was 11.1% lower than in the corresponding 2019 period.

According to BIMB, the weaker performance was owing to the impact of lower net financing income arising from downward revisions of the overnight policy rate and the recognition of a RM97.8mil modification loss due to the moratorium exercise in April 2020.

The bank however maintained strong assets portfolio quality with a low gross impaired financing ratio of 0.7%, which was half of the 1.5% of the banking system at end-June 2020.

Total gross impaired financing as at June 30, 2020, was RM371.5mil, down from RM559.4mil in the same period last year.

The bank's total capital ratio stood at 19.2%, which it said puts it in a strong capital position to facilitate targeted assistance to customers. Net financing rose 12.1% y-o-y to RM52bil and customer deposits and investment accounts rose 6.8% to RM58.5bil.

Total current, saving accounts and transactional investment account composition stood at 36.2% of total customer deposits and investment accounts.

Meanwhile, the group's takaful business recorded a profit before zakat and tax of RM211.8mil in the first half of 202, as compared to RM210.4mil in 1H2019.

Syarikat Takaful Malaysia Keluarga Bhd's operating revenue fell 10.2% to RM1.43bil versus RM1.59bil in the same period last year, with lower sales recorded in both its takaful segments due to the movement control order and conditional movement control order periods.

The family takaful business however had the bigger impact to earnings with a RM195.4mil y-o-y decline in gross earned contribution to RM772.1mil due to lower sales from credit-related and group medical products.

The general takaful segment recorded a 1.5% lower contribution of RM364.8mil due to the fire class.

In overcoming ongoing operational challenges, BIMB is leveraging new digital technologies during the MCO period, and is increasing its social media presence to cross sell its online products.

"As a pioneer to transform the insurance / takaful business in Malaysia, we will advance to the next level of digital strategy by adopting Artificial Intelligence (AI) with big data analytics and machine learning algorithms to manage the risks and opportunities in the areas of marketing, underwriting, and customer service, and claims processing," it said.
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