Alliance Bank sees 5.5% decline in Q3 profit on higher operating expenses, taxation

PETALING JAYA: Alliance Bank Malaysia Bhd's net profit dropped 5.5% to RM122.55 million for the third quarter ended December 31, 2017 against RM129.68 million in the previous corresponding period, due to higher operating expenses and taxation.
Revenue, however, grew 2.5% from RM378.64 million to RM388 million.
Alliance Bank's nine-month net profit contracted 3.6% from RM394.74 million to RM380.36 million, with revenue rising 6% from RM1.1 billion to RM1.17 billion.
It said in a statement that net loans and advance fell 0.4% but net interest margin improved 10 basis points to 2.36%.
The bank's gross impaired loans ratio stood at 1.2%, which is better than industry average of 1.6%, while loan loss coverage (including regulatory reserve) was at 116.2%. It said the group continues to take proactive actions to reduce delinquencies and manage non-performing loans.
Alliance said it posted a strong capital position with common equity tier 1 ratio at 13.6%. Its total capital ratio improved to 18.7% from 17.1% a year ago.
In the next 24 months, Alliance Bank CEO Joel Kornreich said the group will focus on scaling up its core businesses - Alliance One Account, SME business and Alliance@Work, as part of its transformation agenda.
"Our transformation agenda, augmented by our digital banking strategy, will see us launching solutions with practical value propositions that ease our customers' pain points. At the bank, we will continue to enhance our existing operational systems to deliver better performance and productivity," he added.
At 12.30pm, the stock rose 2 sen or 0.5% to RM4.13 on some 98,100 shares traded.