Public Bank's Q3 net profit up 3% on higher income

PETALING JAYA: Public Bank Bhd’s net profit for the third quarter ended Sept 30, 2016 rose 3% to RM1.24 billion from RM1.20 billion a year ago due to higher net interest income and income from the Islamic banking business.
Revenue jumped 2.4% to RM5.03 billion compared with RM4.91 billion in the previous corresponding quarter.
For the nine months period, its net profit increased by 4.3% to RM3.72 billion from RM3.57 billion in the previous corresponding period due to higher net interest income and higher income from Islamic banking business.
Revenue grew by 5.4% to RM15.02 billion from RM14.25 billion a year ago, mainly attributed to the group’s continued healthy loan and deposit growth.
Public Bank founder and chairman Tan Sri Dr Teh Hong Piow said in a statement the group has demonstrated the ability to generate stable profitability when the operating environment continued to present challenges to the business.
This was attributed to the group’s solid strategy in strengthening its niches in the retail banking business.
For the first nine months of 2016, the Public Bank group’s total loans grew at an annualised rate of 7.2% to RM288 billion. Domestically, the group continued to achieve above-industry loan performance, with its domestic loan growth standing at an annualised rate of 7.8% compared to the domestic banking industry’s growth of 2.8%.
Public Bank achieved an annualised 7.4% growth in total deposits for the first nine months of 2016.
The group’s lending activities continued to be driven by the extension of credit mainly for the purchase of residential properties and passenger vehicles, as well as to the small and medium enterprises.
“Against the backdrop of weak consumer and business sentiment, the group’s loans and deposits business has fared well. As a result, the group continued to maintain a healthy loan-to-deposit ratio of 90.2% as at end-September 2016,” the bank said in its statement.
The Public Bank group continued to uphold its strong asset quality record, with the lowest gross impaired loan ratio of 0.5% as at the end of September 2016, compared with the banking industry’s ratio of 1.7%.
For the Malaysian economy, the bank said, while headwinds continue to pose downside pressure to growth, expectations are for a healthy expansion given the support from domestic demand.
“The Public Bank group’s stable performance for the first nine months of 2016 has reaffirmed the proven business strategies of the group in withstanding challenges in the operating environment.
“The group sees prudent risk management, sound corporate governance and sustaining superior asset quality continue to be the keys to maintaining trust and confidence among stakeholders and in ensuring long-term sustainability of the group’s profitability.”