CIMB first-quarter net profit up five-fold

“I’m pleased to see positive momentum across all our businesses, with especially strong income growth in our wholesale banking and consumer banking businesses, ” group CEO Datuk Abdul Rahman Ahmad (pic) said.

KUALA LUMPUR: CIMB Group Holdings Bhd remains cautious in the short term on possible downside risks following the implementation of the full lockdown measures by the government in an effort to keep a lid on the Covid-19 pandemic.

The cautious stance came about despite the bank’s net profit for the first quarter ended March 31,2021, growing by about five times to RM2.46bil from RM507.93mil in the same quarter a year ago.

CIMB Group’s revenue for the quarter rose to RM5.96bil from RM4.14bil a year ago.

“The strong performance seen in the first quarter is an early indicator of recovery, underpinned by the resilience of our underlying business.

“I’m pleased to see positive momentum across all our businesses, with especially strong income growth in our wholesale banking and consumer banking businesses, ” group CEO Datuk Abdul Rahman Ahmad said.

“Our digital businesses also registered healthy growth, as CIMB Philippines reached 3.5 million customers while TNG Digital achieved 15.5 million registered users, ” he said in a statement.

He also highlighted the group’s cost optimisation initiatives that had seen it being able to further lower its cost-to-income ratio to 48.7%. “Cost remains a core focus and we are pleased to see our cost initiatives gaining traction. At the same time, we will continue to spend strategically in key areas such as technology to drive digitisation across the bank.”

“Accordingly, we maintain our earlier announced key financial targets for financial year 2021 (FY21) such as a return on equity of 6%-7% and the cost-to-income ratio of below 52%, although loan growth target of 4%-5% may be at risk given the uncertain economic recovery, ” Abdul Rahman added.

CIMB Group’s total gross loans increased by 0.7% year-on-year (y-o-y) to RM366.6bil while total deposits grew by 3.3% to RM412.2bil.

Its loan-to-deposit ratio stood at 88.9% as at March 21 which is a marginal decrease from 89.0% in the preceding quarter.

Its current account-savings account (CASA) continued to grow strongly with a 19.8% y-o-y growth, with the CASA ratio strengthening to 42.3% as at March 21 from 41.3% as at Dec 20.

“While it may be too early to tell given the pandemic’s resurgence causing ongoing risk to economic recovery, the positive start to FY21 signals that we are moving in the right direction on our Forward23+ strategic plan.

“The group also remains committed to continue providing support to borrowers who continue to be financially affected by the pandemic.

“We would like to stress that repayment assistance remains available to all affected borrowers and we encourage them to reach out to us to discuss any loan repayment assistance, ” he said.