AMMB Holdings posts higher net income
 28 Nov 2017 18:19
AMMB Holdings Bhd’s net income rose 2.3% year-on-year (yoy) to RM1.94 bil on the back of a marginal 1% rise in operating revenue to RM4.2 bil for the first half-year ended Sept 30.

The income growth was due to an 8.6% increase in net interest income to RM831 mil. Net interest margin (NIM) improved to 1.99% from 1.93% due to lower average cost of funds. However, pre-tax profit fell 7.4% to RM881 mil due mainly to lower writebacks. Net profit after tax and minority interests rose 1% to RM659.7 mil.

Loans and financing base grew 2.2% since March 31 to RM93 bil, underpinned by a RM2.19 bil increase in mortgage loans and RM1.1 bil in SME loans. These translated to year-to-date growth of 10% and 7.6% respectively.

The wholesale banking division’s income fell 6.5% yoy to RM646 mil, attributable to lower fixed income sales. However, the business banking division’s income grew 20.8% yoy to RM123.6 mil.

Moving forward, the company expects mild pressure on its NIM to continue but of lesser degree. It also anticipates the overnight policy rate (OPR) to be maintained at 3%. The normalisation rate for OPR is around 3.5%, suggesting the possibility of two rate hikes with the first possibly in the first quarter of next year, and the second either at year-end or in early 2019.

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