Maybank nine months profit up 13.4% to $1.1bn

The company’s positive result boosted by Maybank Islamic which saw pre-tax profit rising 64.1% to $210.28mn.

Maybank on Thursday announced a 13.4% rise in Group profit after tax and minority interest (PATAMI) for the nine months ended March 2011 to RM3.3 billion ($1.1 billion) compared with the RM2.91 billion recorded in the previous corresponding period ended March 2010. Group pre-tax profit rose 13.2% to RM4.54 billion compared to RM4.01 billion previously, according to a Maybank report.

The results were boosted by strong loans growth, increased revenues across almost all business segments of the Group and significantly lower allowance for losses on loans which declined by almost half. 

Overall loans growth stood at 17.1% which was led by the Indonesian operations (+26.5%), Singapore Operations (+19.3%), other international operations (+22.5%) and the Malaysian operations (+13.8%). Within Malaysia, Maybank Islamic led in financing growth with an annualised increase of 31.9% followed by Global Wholesale Banking (+17.7%) and Community Financial Services (+12%). 

The improved performance for the nine months can be attributed to:

• A 7.6% increase in net interest income to RM5.36 billion despite a narrowing of the net interest margin to 2.63% as at March 2011 compared with 2.77% in March 2010.
• Higher non-interest income (including income from Islamic and Insurance businesses) which rose 3.0%, led by higher fee income from Islamic operations (+109.7%), investment & trading income (+65.8%), commissions, service charges and fees (+7.3%) and foreign exchange income from customers (+12.7%).
• Significant reduction in allowance for losses on loans which fell 49.8% to RM454.4 million from RM905.5 million previously. 
• Continued improvement in asset quality with net impaired loan ratio declining to 2.39% from 2.83% in June 2010. 
• Sustained deposit growth of 13.4% to RM260.7 billion as well as asset growth of 17.3% to RM 380.3 billion 
• A 44.3% rise in profit before tax of Community Financial Services which rose to RM2.34 billion from RM1.62 billion previously. 
• Improved profit before tax from Corporate Banking which rose 35.1% to RM695.7 million from RM515.1 million previously. 
• A 13% growth in profit before tax for Maybank Singapore which reached S$286.8 million from S$253.9 million previously. 
• Strong performance by Maybank Islamic which recorded profit before tax and zakat of RM631.9 million compared with RM385.0 million previously.

Maybank Group Quarterly Results Q-on-Q and Y-o-Y
Compared to the second quarter of FY11 ended 31 December 2010, the third quarter ended 31 March 2011 saw profit before tax rising to RM1.58 billion from RM1.56 billion previously. PATAMI for the third quarter was higher at RM1.14 billion compared with RM1.13 billion in the preceding quarter.

Compared to the third quarter ended 31 March 2010, profit before tax and PATAMI for the third quarter ended 31 March 2011 were 8.3% and 10.9% higher respectively.

Comments by Maybank Chairman, Tan Sri Megat Zaharuddin Megat Mohd Nor:

"I am pleased our focus in building regional capabilities whilst maintaining domestic leadership has led to continued strong profit growth. Our regional talent pool are ramping up efforts to leverage our presence across the region, especially in our wholesale banking, embedding our approach of humanising financial services.

"It is gratifying to our people that wide recognition has been given for our efforts, such as the Euromoney Award for Best Private Banking Services Overall in Malaysia, the Asian Banker Award for Best Retail Bank in Malaysia and the Malaysian Institute of Directors’ Award for Innovative Leadership in Globalisation. 

"We will also enhance our stakeholder value creation through efforts in Corporate Responsibility. In this regard, I would expect the Maybank Foundation's thrusts region-wide will have greater impact in our respective communities". 

Comments by Maybank President & CEO, Dato’ Sri Abdul Wahid Omar:

“The sustained performance is a reaffirmation that we are on the right path to achieve our vision of becoming a regional financial services leader by 2015. The all-round revenue improvement in our various business segments is encouraging while the strong deposit growth is helping sustain diversity in our loan book. We are assured that our strategy in focusing on Islamic banking is bearing fruit given the accelerated growth and sterling results achieved in this segment. With the new Islamic banking subsidiary we have launched in Indonesia, we are optimistic that Maybank can grow its Islamic banking franchise to become a leading Islamic bank in ASEAN. 

"We are also pleased with the Group's robust capital position, in particular the confidence demonstrated by shareholders who have opted to reinvest 91% of the recently declared interim dividends under our Dividend Reinvestment Plan. This will put us in good stead to tap future growth opportunities particularly those that will come as a result of the implementation of the government's Economic Transformation Programme”.