PETALING JAYA: Public Bank Bhd
expects the Malaysian economy to remain anchored by resilient domestic demand and supportive government policies in 2026, although geopolitical tensions, trade tariffs and volatility in global financial markets are likely to pose challenges to global growth.
The banking group said household spending, investment activity, exports and tourism should continue supporting Malaysia’s economic expansion, while the domestic banking sector remains resilient on the back of ample liquidity and healthy capital buffers.
Against this backdrop, Public Bank reported a 3.7% year-on-year (y-o-y) increase in net profit to RM1.82bil for the second quarter ended June 30 (2Q26) for the financial year ending December (FY26), from RM1.76bil a year earlier.
Pre-tax profit rose 2.5% to RM2.39bil from RM2.33bil previously, according to its unaudited financial results, in line with a 3.5% growth in revenue y-o-y to RM7.61bil.
The quarterly improvement was driven mainly by stronger non-interest income (NOII), which rose RM165.7mil or 21.3%, largely on improved sales of trust units and higher unit trust management fee income.
This helped offset higher loan and financing impairment charges, which increased by RM81.1mil amid what the bank described as a normalisation of credit charges, as well as a RM26.3mil increase in other operating expenses.
The performance also represented an improvement over 1Q26, with pre-tax profit rising 3.4% from RM2.32bil while net profit attributable to shareholders increased 4.2% from RM1.75bil.
NOII increased RM150.7mil or 19% quarter-on-quarter (q-o-q), supported by higher unit trust-related fees, investment income and foreign exchange income.
Revenue, meanwhile, posted an increase of 3.9% q-o-q from RM7.32bil.
For the first half of FY26 (1H26), Public Bank’s pre-tax profit increased 1.3% to RM4.71bil, while net profit attributable to equity holders rose 2% to RM3.58bil.
Turnover in 1H26 registered a 1.8% y-o-y growth to RM14.9bil.
The group said its 1H26 operating profit increased 3.4%, underpinned by a 12.2% increase in non-interest and non-financing income, while net interest and financing income growth moderated to 0.5% amid a highly competitive loan and deposit market.
The lender’s loan book remained a key support for earnings.
Gross loans, advances and financing rose 5.9% on an annualised basis to RM458.9bil as at end-June, with domestic financing for small and medium enterprises (SMEs), residential property financing and hire purchase growing 12.1%, 4.3% and 6.5%, respectively.
Customer deposits increased 4.7% on an annualised basis to RM457.6bil. Asset quality remained sound, with the gross impaired loan ratio at 0.54%, significantly below the industry’s 1.43%.
NOII continued to provide an important earnings buffer. For the first six months, it rose 12.2% to RM1.8bil, driven by growth in the unit trust, foreign exchange and general insurance businesses.
Fund management was particularly strong, with pre-tax profit rising 16.6% to RM470.5mil, while Public Mutual retained a 44.6% share of Malaysia’s retail private unit trust market, excluding money market funds.
Looking ahead, Public Bank said it would remain focused on its core residential property, passenger vehicle and SME financing businesses while maintaining prudent credit risk management.
It also plans to strengthen its wealth management and private retail unit trust businesses, expand its syariah-compliant offerings, deepen its general insurance collaboration with LPI Capital Bhd and remain prudent in its treasury operations amid volatile capital markets.
“In addition to its core financing and deposit businesses, NOII remains a key contributor to the Public Bank Group’s performance and longer-term growth.
“The group continues to strengthen its private retail unit trust andwealth management segments through the diversification and enhancement of its product offerings,” it said in a filing with Bursa Malaysia.
Commenting on the 1H26 results, managing director and chief executive Tan Sri Tay Ah Lek said as global uncertainties remain, the bank is mindful of the potential impact that could affect customers through energy prices and inflation, as well as consumer and business sentiments.
“Public Bank remains fully committed to standing by the customers during this challenging period.
“Against the significant global headwinds, the Public Bank Group will remain vigilant in its business approach.
“Meanwhile, the group continues to see growing opportunities stemming from the resilient domestic economy and will continue to build on its core competencies to optimise stakeholder value,” he said.
Public Bank also declared a first interim dividend of 10.5 sen per share for FY26 amounting to about RM2.04bil.
The dividend entitlement date is Sept 11, with payment scheduled for Sept 23.
On a separate note, it added that it remains committed to embedding sustainability in its core practices, guided by its focus on decarbonisation, climate resilience and inclusive growth, before observing that it is on course to achieve a carbon-neutral position (Scope 1 and Scope 2) by 2030, Net Zero Carbon by 2050 and RM100bil in sustainable finance by 2030.
“The Public Bank Group remains committed to further strengthening its information and communication technology infrastructure for enhanced operational efficiency and resilience. The group will continue to embrace modern technologies to enhance its service delivery standards to cater to evolving customer needs.
“The Public Bank Group will also continue to enhance its cybersecurity efforts to manage risks of cyber frauds and scams.
“The group is highly committed to safeguarding customers’ information and reinforcing cyber resilience and operational integrity,” said Public Bank.
