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CIMB posts first quarterly profit drop since 2015
CIMB Group Holdings Bhd on Wednesday logged its first quarterly profit drop since 2015, with year-ago results being inflated by a one-off gain, while the Malaysian lender also flagged a challenging year ahead.
The lender also reported a profit drop in its consumer, corporate segments and a loss in investment banking unit, a bourse statement showed.
CIMB, Malaysia's second-largest lender by asset, has been posting consecutive quarterly earnings growth since the end of 2015.
"We expect the rest of 2019 to remain challenging, amid fresh trade tensions and other macro-economic headwinds, coupled with tougher operating conditions in our major markets," CEO Zafrul Aziz said in a statement.
Malaysia's economy grew faster than expected in the first quarter at 4.5 per cent supported by a recovery in the agriculture sector, but weakening global demand and the US-China trade war are seen increasing risks for the country.
A year ago, CIMB charted its highest quarterly profit in five years lifted by lower costs and provisions as well as a one-off gain.
The bank's profit for the three months ended March was RM1.19 billion (S$391.6 million), compared with RM1.31 billion in the same period last year.
The net profit, however, was higher than the RM777.9 million average estimate from two analysts polled by Refinitiv.
Revenue came in at 4.17 billion ringgit, a 3 per cent drop from the previous year.
Meanwhile, CIMB's total gross loans grew 7.6 per cent versus a year ago, while deposits rose 5.6 per cent.
Net interest margin (NIM) - a measure of bank profitability - came in at 2.48 per cent in the first quarter, CIMB said.
The lender's net interest income grew 1.7 per cent to RM2.46 billion.
Bigger rival Maybank is expected to report its first-quarter results on Thursday. REUTERS