CIMB Thai Group said the stronger income was mainly due to the 1.5% growth in net interest income and 46.5% growth in other income, offset by a 15% decline in net fee and service income. — Bloomberg
KUALA LUMPUR: CIMB Group
’s banking franchise in Thailand posted a consolidated operating income in the first quarter of financial year 2023 (1Q23) which rose 9.9% year-on-year (y-o-y) to 3.83 billion baht (RM495.3mil) from the same quarter in 2022.
In a statement, CIMB Thai Group said the stronger income was mainly due to the 1.5% growth in net interest income and 46.5% growth in other income, offset by a 15% decline in net fee and service income.
Pre-provision operating profit increased 10.2% y-o-y to 1.87 billion baht (RM242mil), attributed to the higher income.
However, net profit decreased 21.8% y-o-y to 830.1 million baht (RM107mil) due to higher operating expenses, coupled with a 128% increase in expected credit loss.
On a y-o-y basis, net interest income increased 1.5%, mainly driven by loan expansion. Other operating income increased 46.5%, mainly from higher gains on investments and sale of non-performing loans.This was partially offset by lower net fee and service income of 57.7 million baht (RM7.4mil), representing a 15% decline, mainly due to lower fee income from insurance brokerage and underwriting income.Operating expenses increased 9.6%, mainly from higher impairment loss on the sale of properties.
For the quarter under review, the cost-to-income ratio improved to 51.2% compared with 51.4% in the three months of 2022 as a result of stronger operating income growth compared to operating expenses.
Net interest margin over earning assets stood at 2.6% compared with 2.8% in the corresponding three-month period last year as a result of the higher cost of funds.
As of March 31, total gross loans (inclusive of loans guaranteed by other banks and loans to financial institutions) stood at 237.4 billion baht (RM30.7bil), an increase of 0.9% from Dec 31, 2022.
