MBSB’s Q2 earnings up 41% to RM232.86m

PETALING JAYA: Malaysia Building Society Bhd (MBSB), which is in talks with CIMB Group Holdings Bhd and RHB Capital Bhd on a possible merger of the three entities, saw its net profit increase by 41.03% to RM232.86 million for the second quarter ended June 30, 2014 from RM165.11 million in the previous corresponding period, due mainly to lower impairment losses on loans, advances and financing coupled with higher operating income.
Second-quarter revenue went up 9.41% from RM614.30 million to RM672.08 million.
Net profit and revenue for the six-month period rose 29.69% and 13.80% to RM429.59 million and RM1.34 billion respectively.
In a filing with Bursa Malaysia, MBSB said the personal financing and mortgage portfolio growth would be challenging in 2014 as Bank Negara Malaysia has implemented measures to further promote a sound and sustainable household sector.
"Whilst sustaining the personal financing portfolio, the group has been expanding the corporate business segment including tapping into opportunities under the federal government's Economic Transformation Programme (ETP)," it added.
MBSB believes that a well-planned expansion programme into corporate segment will contribute positively to the group in terms of assets and earnings growth whilst diversifying the assets base.
Barring any unforeseen circumstances, it expects the performance in the second half of 2014 to be satisfactory.
For headline key performance indicators (KPIs) in 2014, MBSB said annualised net return on equity up to six-month period was 27.65%, ahead of the 15% target, driven by higher income from Islamic banking operations and conventional business from the expansion of personal financing and corporate business.
However, annualised revenue growth only stood at 5.6%, lower than the 10% target.
MBSB shares closed up 7 sen to RM2.41 yesterday.