KUALA LUMPUR: Malayan Banking Bhd's (Maybank) net profit in the first quarter ended March 31, 2022, fell 14.52% to RM2.04bil compared with RM2.39bil in the previous corresponding quarter.
According to Maybank chairman Tan Sri Zamzamzairani Mohd Isa, the escalation of geo-political tensions, resultant market volatility as well as inflationary pressures somewhat dampened the positive impact of the resumption of economic activities and gradual reopening of international borders.
“While we are cautious in our outlook for the rest of the year given significant uncertainties, we will remain guided by the forward looking strategies set out in our M25 Plan.
"We intend to actively drive new business growth in this recovery period, while at the same time continue supporting our customers to ensure they are able to remain sustainable in the long term,” he added.
For the quarter under review, the group reported revenue of RM11.91bil, a 2.54% decrease from RM12.22bil a year earlier.
Net-fund based income in 1Q22 grew 5.3% to RM4.89bil as net interest margin (NIM) expanded three basis points year-on-year (y-o-y) on lower interest expand and loan growth of 5.2%.
However, this was offset by a 28.3% decrease in total net fee-based income to RM1.56bil across most business segments due to market volatility.
Consequently, net operating income came in 5.4% lower at RM6.45bil from RM6.83bil previously.
As economic activities improved, the group's overheads grew 4% y-o-y on higher revenue-related expenses.
The cost-to-income ratio stood at 45.5%, within the FY22 guidance of 45% to 46%.
Meanwhile, impairment losses continued to decline 31.3% to RM597.1mil from RM868.5mil a year earlier.
In 1Q22, gross loans rose to RM562bil from RM534.4bil a year earlier, on the back of 7.2% growth in Singapore operations and 4.9% expansion in Malaysian operations.
Gross deposits grew 5.5% y-o-y on the back of a steady increase in current account savings account (Casa) deposits across its key home markets, while Casa ratio to total deposits expanded to 46.2% from 44.5% a year earlier.
The group's fully loaded CET1 ratio strengthened to 14.95% in the quarter under review while total capital ratio stood at 18.37%.
Maybank's liquidity coverage ratio and net stable funding ration stood at healthy levels of 143.2% and 118.6% respectively, above the regulatory requirement of 100%.
Gross impaired loans improved to 1.95% from 2.2% in March last year.
Loan loss provisions almost halved to RM443.41mil for 1QFY22 from a year ago mainly on lower management overlay given improving economic outlook.
Loan loss coverage remained at a healthy level of 106.4% as newly impaired loan formation remained low.
Maybank's new group president and CEO Datuk Khairussaleh Ramli said the positive trends in the group's 1QFY22 financial performance were evident across key markets despite the lingering impact of global factor on the operating environment.
“While the outlook for the remaining part of the year remains mixed at this stage, we will focus on tapping into growth opportunities across customer segments in our key markets while maintaining our capital and liquidity strength to facilitate these growth opportunities.
"At the same time, we will ensure our risk management capabilities remain robust, and cost management and productivity efforts continue.
"Additionally, we aim to accelerate solution rollouts on our digital platforms to continue to fulfil customers’ journeys while increasing our market penetration regionally," he said.