PETALING JAYA: RHB Bank Bhd’s net profit for the second quarter ended June 30, 2019 increased 7.9% to RM615.41 million from RM570.26 million recorded in the same quarter last year, attributable mainly to higher non-fund based income and lower expected credit losses (ECL) on loans.
Its revenue grew 12% to RM3.42 billion compared with RM3.05 billion previously.
The bank announced an interim dividend of 12.5 sen per share, representing a dividend payout ratio of 40.2%, highest ever payout based on H1 2019 results.
For the half-year period, RHB reported a net profit of RM1.25 billion, up 7.3% from RM1.16 billion in the same period last year, with revenue rising 9.5% to RM6.77 billion from RM6.18 billion.
The bank’s gross fund based income expanded 7.4% on the back of a 6.9% increase in gross loans and financing, marginally negated by the impact of an Overnight Policy Rate (OPR) cut in May 2019.
Funding and interest expense rose 16.4% due to the impact from the OPR hike in January 2018 coupled with higher deposit base. As a result, net fund based income declined 2.6%.
Non-fund based income improved 21.8% to RM1.10 billion, contributed largely by higher net trading and investment income, insurance underwriting surplus and higher capital market related fee income.
Allowances for credit losses came in at RM146.8 million, 8.1% lower than the previous year, primarily due to lower ECL on loans. Annualised credit charge ratio improved to 0.20% compared with 0.22% over the same period a year ago.
RHB said its capital position remains strong, with common equity tier-1 and total capital ratio after taking into account the FY2019 interim dividend standing at 16.32% and 19.38% respectively.
The group’s gross loans and financing grew 6.9% to RM172.3 billion, supported mainly by resilient growth in mortgages, SME and Singapore. The group’s domestic loan market share stood at 9.0% as at end-June 2019.
Gross impaired loans ratio improved to 2.15% from 2.33% a year ago with gross impaired loans at RM3.7 billion as at June 30, 2019. Its loan loss coverage was at 106.1%.
Customer deposits recorded a 10.9% growth to RM185.0 billion as at June 30, 2019, contributing to a liquidity coverage ratio of 149.2%.
RHB group managing director Datuk Khairussaleh Ramli (pix) said it is on track with its five-year strategy, FIT22, aimed at improving business performance and enterprise wide capabilities through digital technology and the implementation of the agile way of working.
Its SME segment in particular has seen encouraging growth with almost RM4 billion loans approved in H1 2019, benefitting around 2,000 SME businesses. SME loans and financing grew 3.3% year-to-date since December 2018, ahead of industry which declined by 0.4%.
At 2.45pm, RHB’s share price was trading 2 sen lower at RM5.55 on 1.75 million shares done.
