Maybank Post Q1 Net profit RM881.8m

KUALA LUMPUR: MALAYAN BANKING BHD
posted net profit of RM881.8 million in its first quarter ended Sept 30, 2009, RM309.63 million or 54% higher than the RM572.17 million a year ago.
This was in sharp contrast to its fourth quarter ended June 30, 2009 when the bank suffered a net loss of RM1.12 billion after it had made an impairment charge of RM1.617 billion on goodwill arising from its 97.5%-owned PT Bank Internasional Indonesia Tbk's (BII) banking operations and an additional impairment loss of RM111 million for its investment in Pakistan's MCB Bank.
The bank said on Thursday, Nov, 12 that 1Q revenue was RM2 billion compared with RM1.55 billion a year ago. Earnings per share were 12.46 sen versus 11.72 sen. Group pre-tax profit rose to RM1.16 billion, up 31.1% from RM881.77 million a year ago.
"With the improving business environment, the group's treasury, international, insurance and investment banking operations were the key drivers in the strong performance registering growth in pre-tax profit by 87%, 50%, 61% and 201% respectively," said the bank.
Maybank said the results included profit after tax contribution from BII, MCB Bank and AnBinh Bank of Vietnam of RM48.9 million, RM22.9 million and RM15 million respectively. There was no profit contribution from BII in the previous corresponding quarter as the acquisition was only completed on Sept 30, 2008.
It said earnings per share for 1Q rose to 12.46 sen from 11.72 sen previously after adjusting for the rights issue in March 2009.
"Net interest income for the group grew 28.7% to RM1.63 billion from RM1.27 billion previously, on the back of an annualised 11.2% growth in loans as well as higher lending margins particularly in BII," it said.
The net interest margin for the quarter improved by 30 basis points to 2.82% compared with 2.52% in September 2008. The better margin is attributed mainly to the lower cost of customer deposits as a result of the rights issue proceeds as well as improved margins on loans and from overseas operations.
Maybank said non-interest income (including marked to market gaines/losses on derivatives and securities held for trading) more than doubled to RM1.14 billion from RM495 million previously mainly arising from robust growth in investment and trading income as well as transactional income including transactional fees, foreign exchange profit and net premiums written. Investment and trading income soared to RM104.4 million from RM11.5 million previously while transactional income rose to RM624.6 million from RM460.3 million previously.
Overhead costs for the group (excluding claims) increased by 31.8% over that of the corresponding period as a result of the consolidation of BII overhead costs. Excluding BII, overhead costs increased by 4.7%.
The group's allowance for losses on loans, advances and financing rose by RM232.3 million to RM417.7 million due mainly to the incorporation of BII provisioning for this quarter and an increase in provisions for Malaysian domestic operations during the period.
However, compared with 4Q ended June 2009, loan losses and provisions for the current quarter were 46.6% lower. The group's loan loss coverage continued to be comfortable, improving from 112.9% in June 2009 to 113.2% as at Sept 2009.