PETALING JAYA: Malaysia Building Society Bhd’s (MBSB) net profit for the third quarter ended Sept 30, 2020 increased 51.76% to RM258.24 million from RM170.16 million a year ago, marking a recovery from being in the red for the last two quarters.
Revenue also went up 1.9% to RM765.57 million from RM751.63 million as the group realised higher gains from financial investments at fair value through other comprehensive income.
Its year-to-date 2020 (YTD’20) net profit fell 52.1% to RM172.48 million from RM360.21 million, but revenue rose to RM2.39 billion from RM2.23 billion contributed mainly by higher income from investment and treasury activities.
Financing and loan interest income reduced slightly by RM14.84 million from both retail and corporate financing and loan due to the lower disbursement made for the year and reductions in Overnight Policy Rates (OPR).
President and CEO Datuk Seri Ahmad Zaini Othman said he is pleased with the improved results after the considerable impact to its bottom line last quarter caused by the modification loss.
“Hence when we revised our strategies then, it was not only to ensure the sustainability of all income streams but to also focus on a stable and gradual unwinding of this modification loss”.
The group ended the period YTD’20 with total assets of RM49.93 billion that is lower by 1.55% from the position as at Dec 31, 2019, primarily due to drop in total deposits and other funding, but cushioned by higher financing of RM259.04 million. On a quarterly basis, total assets increased by RM1.34 billion contributed by higher financing and financial investments.
As for asset quality, a higher gross impaired financing (GIF) was recorded at RM5.86% (Q3’20) as compared to 5.19% (Q4’19) which was due to higher impairments from the corporate financing and loan. However, it improved slightly from 6.08% (Q2’20) contributed by the retail financing and loan. At MBSB Bank level, the GIF stood at 3.13% (Q3’20) reducing from 3.28% (Q2’20).
Total capital ratio increased by 0.28% to 23.76% (Q3’20) from 23.48% (Q4’19) while the group’s liquidity coverage ratio fell by 28.68% to 148.20% compared to 176.88% in Q2’20.
On the outlook for next year, Zaini acknowledged the cautious sentiment by both retail and corporate segments due to some economic uncertainties still looming. Nevertheless, these sentiments may improve by the expectations of progress on the economic recovery coupled with the implementation of Budget 2021 that shall provide a major relief to B40 and M40 segments.
