Global problem: Sulaiman admits that security breaches are a global phenomenon and not unique to Malaysia.
KUALA LUMPUR: AMMB Holdings Bhd
posted earnings of RM331.46mil in the second quarter ended Sept 30, 2017, down 6% from RM352.62mil a year ago on higher net impairments.
The banking group announced on Tuesday revenue rose 1.2% to RM2.12bil from RM2.10bil. It declared an interim dividend of five sen a share. Earnings per share were 11.02 sen compared with 11.73 sen.
AMMB said there was net impairment loss of RM10.71mil for doubtful sundry receivables compared with just RM1.16mil a year ago.
For the first half, its earnings were lower by 2.3% to RM659.74mil from RM675.62mil in the previous corresponding period.
AmBank Group CEO Datuk Sulaiman Mohd Tahir said the topline growth momentum was sustained in transaction banking, business & SME banking and retail banking whilst markets based revenue was affected by the volatility in the market.
Its revenue increased by just 1% to RM4.205bil from RM4.162bil.
He said the group recorded an encouraging 9.9% growth on-year in net interest income (NII) supported by interest income from customer lending and fixed income securities.
“Interest income from customer lending continued to benefit from the robust growth in our targeted segments namely mortgages and the small and medium-sized enterprises (SME) segments.
“Interest income from securities grew mainly from trading securities and investment in unrated corporate bonds and sukuk,” he said.
Sulaiman said AMMB's loans and financing base grew 2.2% year-to-date since March 31, 2017 to RM93bil.
The growth was underpinned by an increase of RM2.187bil (+10.0% YTD) in mortgage loans and RM1.1bil (+7.6% YTD) in SME loans.
“As a result of our targeted card usage programmes, our cards receivables contributed RM80.7mil to our loans base, marking an encouraging YTD growth of 4.8%,” he said.
On the earnings outlook for the second half of FY18 (H2FY18), Sulaiman guided that NII continues to deliver steady growth while NOII from investment banking and money market activities is expected to be lumpy.
“Wealth management, cards and corporate banking continue to drive NOII in H2FY18. We expect credit cost to continue to normalise with reduced recoveries relative to FY17.
“Impairment allowances are expected to be at levels that are reflective of our loans growth. Our asset pricing continues to be refreshed as we improve our capability to price for risk for sustainable NIMs,” he said.
“SMEs together with the digital economy are key growth drivers. To capitalise on the growth potential in the SME segment, our Business Banking team is in the process of setting up new business centres.
“Given the strong growth potential of the digital economy, we have enhanced our online portal and mobile banking.
“We will continue to introduce cutting edge Digital Banking capabilities to provide us with the added competitive advantage in todays’ digitalised environment.”
“We remain committed to our FY18 strategic priorities and will continue to grow quality assets, improve our deposit mix, maximise our fees, optimise our risk-adjusted returns whilst improving our service delivery. We remain steadfast in achieving our Top 4 aspirations while delivering optimal returns to our shareholders,” he added.
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