Alliance Bank to focus on managing asset quality

The bank says it aims to add more customers by scaling up the group’s core segments of small and medium enterprises and consumer banking.

PETALING JAYA: Alliance Bank Malaysia Bhd (ABMB) will focus on managing its asset quality by continuing to prioritise customer engagement and managing its loan portfolio.

It said it will be acquiring more customers by scaling up the group’s core segments of small and medium enterprises (SMEs) and consumer banking.

ABMB also said it will be adding on sales force capacity and improving productivity by equipping relationship managers with digital tools to serve high-value customers.

“The group will also focus on securing more customers via digital channels and diversifying our corporate customer base by focusing on family-owned corporations,” it said in a filing with Bursa Malaysia yesterday.

For the second quarter ended Sept 30, 2022, ABMB’s net profit dropped to RM158.42mil from RM172.74mil in the previous corresponding period, while revenue grew to RM480.57mil from RM452.98mil.

Basic earnings per share was lower at 10.23 sen, compared with 11.16 sen a year earlier.

ABMB also declared a first interim single-tier dividend of 12 sen per share, to be paid on Dec 28.

For the six-month period ended Sept 30, 2022, net profit improved to RM370.58mil from RM318.76mil a year earlier, while revenue stood at RM954.65mil compared with RM935.94mil in the previous corresponding period.

ABMB said the improved profit were largely due to higher net interest income and lower allowance for expected credit losses.

“Net interest income improved by RM89.8mil or 12.4% year-on-year (y-o-y), mainly due to higher loan growth and the increase in the overnight policy rate. Net interest margin came in higher at 2.64%.”

ABMB said loans, advances and financing continued to grow by 6.7% y-o-y to RM46.8bil, mainly driven by growth across all lines of business.

“The group recorded other operating income of RM141.7mil, lower by RM71.1mil or 33.4% y-o-y.

“The decrease was due to reduced treasury and investment income arising from the challenging investment environment and lower income from brokerage, offset by higher wealth management income and trade fees.”

Looking ahead, ABMB said it will be capitalising on its consumer and business banking franchises.

“We will focus on accelerating cross-selling value propositions to our customers to increase market penetration and generate fee-based income.”

ABMB also said it will enhance productivity and efficiency by streamlining processes, automating through digital tools and channels, centralising functions and improving branch productivity.

Separately, in a statement, group chief executive officer Kellee Kam said ABMB is built on strong foundations.

“The strategic priorities have guided the bank to achieve success and sustainable results in the SME sector, as evidenced by our market share in this segment relative to our size and improving performance.

“Going forward, we will focus on broadening our strategy and expanding into new areas beyond SME to accelerate our growth,” he said.

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