CIMB Group CEO Novan Amirudin.
PETALING JAYA: CIMB Group
Holdings Bhd is optimistic about achieving its targets for the current financial year ending Dec 31, 2024 (FY24). This confidence stems from the group’s strong performance to date and a strategic focus that positions the group for continued growth.
Nevertheless, the group remains cautious of external uncertainties, which could impact its performance, says CIMB group chief executive officer Novan Amirudin, while noting that the bank’s strong performance to date reflects its strategic focus and commitment to delivering value.
“We are on track to achieve our FY24 targets as we approach the final quarter of our Forward23+ journey and will continue to explore strategies to optimise cost, while remaining vigilant in managing risk amid economic headwinds and market volatility,” Novan said in a statement.
In the third quarter ended Sept 30, 2024 (3Q24), CIMB reported a net profit of RM2.03bil, up almost 10% from RM1.85bil in the corresponding quarter a year ago, translating to an earnings per share of 18.98 sen against 17.32 sen previously.
During the quarter under review, the group’s revenue rose 8% to RM5.74bil from RM5.31bil in the comparative quarter.
For the nine months to September 2024 (9M24), CIMB registered a net profit of RM5.93bil, up 12.6% from RM5.27bil in 9M23, on revenue of RM16.97bil against RM15.64bil in the comparative period.
“The 9M24 results reflect another solid performance for the group. Our achievement is underpinned by the trust of our customers and strong execution of our Forward23+ strategic plan,” Novan said.
“Notwithstanding the positive performance, we remain cautious of external uncertainties and will monitor the macroeconomic backdrop whilst being confident in our current strategies.
“We have also made significant investments in strengthening our technology resiliency to deliver superior customer experience,” he added.
According to Novan, the group aimed to strengthen its deposit franchise and embrace the theme of “simpler, better, faster” throughout its business, which would be central to its new strategic plan.
“This builds on our competitive strengths, endowments, and anticipated key market trends, with further details to be announced in 1Q25,” he explained.
CIMB’s operating income grew 8.5% year-on-year (y-o-y) to RM16.97bil for 9M24, supported by a 6% increase in net interest income from asset growth and a 14.4% rise in non-interest income to RM5.39bil, driven by stronger fees, treasury client sales, and trading income.
The group’s net interest margin (NIM) has improved for three consecutive quarters, rising from 2.59% in 4Q23 to 2.75% in 3Q24, owing to price discipline and deposit-led strategies. However, the group expects some normalisation and pressure on NIM in 4Q24 due to year-end seasonality and liquidity competition.
CIMB’s annualised return on average equity (ROE) rose to 11.7% from 10.7% in the prior year, reflecting its improved profitability.
The group’s total gross loans grew 4.3% y-o-y, supported by strong demand across its markets, while deposits increased marginally during the period.
Its current account and savings account (CASA) balances rose 4.5%, lifting the CASA ratio to 42%. The cost-to-income ratio improved 40 basis points y-o-y to 45.9%, underpinned by disciplined cost controls and positive operating leverage, contributing to a 9.3% growth in pre-provisioning operating profit to RM9.18bil.
Asset quality also improved, with the gross impaired loans ratio declining from 3.2% in September 2023 to 2.3% in September 2024, while allowance coverage strengthened from 95% to 102.6%.
CIMB’s Common Equity Tier 1 ratio increased to 15%, up 60bps y-o-y, remaining well within its FY24 target.
