Maybank posts record Q1 profit on lower expenses
Profit up 10% on 2% rise in revenue; loans grew 6.7% in Malaysia and 5.5% in S'pore
Kuala Lumpur
MALAYAN Banking Bhd (Maybank), Malaysia's largest lender, posted its highest ever first-quarter profit, helped by a drop in expenses and continued decline in impairment losses.
Maybank's net profit for the quarter was RM1.9 billion (S$640.3 million), up 10 per cent from RM1.7 billion a year ago. It beat an average estimate of RM1.85 billion from two analysts surveyed by Thomson Reuters. Revenue was 2 per cent higher at RM11.5 billion.
The results were supported by a better cost-to-income ratio of 47.6 per cent, versus 50.1 per cent a year ago, as fee-based and fund-based income growth outpaced rise in overhead expenses, the bank said in a statement on Monday.
Net impairment losses for the quarter ended March fell 7.7 percent, while gross impaired loans ratio improved to 2.37 per cent from 2.40 per cent, it added.
Maybank's Malaysian operations recorded a strong 6.7 per cent increase in loans, while its Singapore and Indonesia operations saw increases of 5.5 per cent and 2.9 per cent, respectively.
On the group level, loans expanded 1.5 per cent year-on-year.
Maybank chairman Mohaiyani Shamsudin said the bank was buoyed by the positive outlook in the region and Malaysia, despite some uncertainties in the operating environment.
"In particular, we await policies which are expected to be outlined by the new government in Malaysia which we hope will further drive private sector investments and enhance consumer confidence," she said.
The country's lenders are seeing increased domestic loan demand from sectors including manufacturing, finance and infrastructure, analysts said.
Malaysian banks with presence in the neighbouring South-east Asia countries expect stronger demand for corporate and consumer loans as economies improve, which is likely to support credit growth in 2018.
But slower economic growth is a concern and uncertainty over economic policy has increased after 92-year-old Mahathir Mohamad led an opposition alliance to a surprise election win this month. Malaysia's first-quarter GDP grew 5.4 per cent from a year earlier, its second straight quarter of slower economic growth.
Maybank's net interest margin (NIM) - the difference between interest paid and earned and a key gauge of bank profitability - shrank slightly to 2.39 per cent in the first quarter from 2.43 per cent a year ago. REUTERS
BT is now on Telegram!
For daily updates on weekdays and specially selected content for the weekend. Subscribe to t.me/BizTimes
Companies & Markets
CapitaLand Investment posts total revenue of S$650 million for Q1
Pricey coffee is here to stay as hoarding, heat hit Vietnam supply
Toyota is investing US$1.4 billion to build another all-electric SUV in US
Airbus net profit soars 28% in first quarter
Carrier AirAsia discloses new listing plans under RM6.8 billion units merger
Intel slides after tepid forecast spurs fears about comeback