KUALA LUMPUR: RHB Bank Bhd has posted a record net profit of RM1.16 billion for the first half of this year and expects the full-year performance to be better than 2017.
The interim profit was 16 per cent higher year-on-year, mainly due to higher net fund based and non-fund based income and lower allowances for credit losses on other assets.
“The group’s earnings momentum was sustained in the second quarter resulting in improved first half of 2018 year-on-year performance.
“Our results also reflect strong fundamentals as can be seen in our robust capital levels, healthy liquidity position and adequate coverage for loan losses,” RHB Banking Group managing director Datuk Khairussaleh Ramli said at a briefing on the results here today.
“Barring unforeseen circumstances, the group expects to achieve better performance in 2018,” the group said in a statement.
RHB Group’s net fund based income rose 10.8 per cent to RM2.48 billion from a year ago while gross fund based income increased 6.6 per cent on the back of a 3.1 per cent increase in gross loans and financing.
Its Islamic banking contributed 31.4 per cent of total domestic loan and financing from 27.3 per cent a year ago.
In the second quarter ended June 30, this year, RHB’s net profit rose 13.8 per cent year-on-year to RM570.26 million. Its revenue for the quarter increased 1.1 per cent to RM2.66 billion from a year earlier.
The bank declared interim dividend of 7.5 sen per share or 25.9 per cent payout ratio.
On a quarter-on-quarter basis, its net profit for the current quarter was at RM570.3 million, a decrease of 3.5 per cent from RM590.8 million recorded in the preceding quarter ended March 2018.
The bank said this was due to lower non-fund based income, in particular from the absence of one-off gain recorded in the preceding quarter and lower mark-to-market gain on securities and derivatives.
The bank said the implementation of MFRS9 resulted in higher allowances for credit losses on loans by 16.3 per cent to RM180.9 million.
“Allowances for credit losses on other assets were lower by RM142.8 million mainly due to improved ratings of our investment portfolio and the absence of impairment provided on an oil and gas related bond in Singapore in the previous corresponding period,” it added.