KUALA LUMPUR: Affin Bank Bhd said 2023 was a challenging year as the industry was faced with margin compression, which impacted net interest income.
"Net interest margin (NIM) compression has continued to impact revenue, but the group has shown resilience by building stronger and deeper foundations for current account savings account (Casa), loan growth, gross impaired loans, loan loss coverage, and customer acquisitions that will catapult us into the future," said president and group CEO Datuk Wan Razly Abdullah in a statement.
In the fourth quarter ended Dec 31, 2023, Affin Bank registered a net profit of RM39.54mil, more than double net profit of RM16.56mil in the year-ago quarter, mainly owing to lower allowance for impairment losses and higher interest income.
The group's earnings per share rose to 1.62 sen from 0.4 sen previously.
Revenue, meanwhile, dropped to RM486.19mil from RM566.71mil in the comparative quarter.
The board of directors proposed a final dividend of 5.76 sen per share, representing a total dividend payout of about RM135.3mil or 33.6% of the group's net profit in FY23.
Over the full financial year, the group's net profit was RM402.19mil compared to RM1.18bil in FY22 while revenue was RM1.99bil compared to RM3.3bil in the previous year.
According to Affin, non-interest income in FY23 was RM607.3mil, a 76.6% increase over the previous corresponding period, excluding the sales proceeds from the disposal of the asset management business.
Net interest income, however, was RM782.9mil, or 23.5% lower year-on-year (y-o-y) due to net interest margin compression.
The group said total loans, advances and financing grew 12.3% y-o-y to RM66.66bil contributed mainly by the 17.1% growth in the community banking segment.
On deposits, Casa was RM18.9bil while Casa ratio stood at 26.7%.
The group said customer deposits increased 9% y-o-y to RM70.8bil as at Dec 31, 2023.
