AmBank Group’s fy20 profit slips 10.9pc to rm1.34b
Published on: Tuesday, June 30, 2020
By: Bernama
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Kuala Lumpur: AMMB Holdings Bhd’s (AmBank Group) net profit declined 10.9 per cent to RM1.34 billion in the financial year ended March 31, 2020 (FY20) as its final quarter’s earnings were impacted by the Covid-19 pandemic.

Revenue, however, rose to RM9.32 billion from RM9.12 billion in the previous year, mainly due to net interest income (NII) and non-interest income (NoII) growth, the financial services group said in a filing with Bursa Malaysia.

In a statement on Monday, AmBank Group Chief Executive Officer Datuk Sulaiman Mohd Tahir said in light of the economic disruption due to the pandemic and amid the fall in global oil prices, the group had set aside an additional macro provision of RM167.3 million in the fourth quarter to reflect a more challenging outlook.

“As a result, our net credit cost for the year increased to 30 basis points from a net recovery position last year. Higher net provisions impacted our profit after tax and minority interests (Patmi) which stood at RM1.34 billion,” he said.

Sulaiman noted that the previous year’s results also included a one-off gain from the retail non-performing loan sale of RM285 million.

“In fact, our underlying Patmi of RM1.47 billion was up 15.4 per cent year-on-year (y-o-y), after normalising the one-off gain and the additional macro provision that was set aside as additional prudence,” he said.

The group’s total income rose 7.8 per cent to RM4.23 billion due to NII growth of 7.5 per cent to RM2.77 billion and NoII growth of 8.3 per cent to RM1.45 billion.

Meanwhile, return on equity was lower at 7.4 per cent (FY19: 8.8 per cent), with return on assets of 0.93 per cent (FY19: 1.08 per cent) and basic earnings per share of 44.6 sen (FY19: 50.0 sen)

The group declared a final dividend of 7.3 sen per share, bringing its total dividend for the year to 13.3 sen (FY19: 20 sen).

Sulaiman said the bank’s balance sheet was stronger, and that it was well-capitalised and more diverse in its liquidity profile compared to just four years ago. 

“We are certain that AmBank Group is on a strong footing to navigate economic uncertainties and challenges, particularly given the current Covid-19 pandemic.

“We remain committed to support our people, customers and communities during this unprecedented period,” he said.

The bank said it continues to closely monitor the impact of Covid-19 pandemic on our credit portfolios during the moratorium period. 

About RM65 billion, or 61 per cent, of the group’s total loans in the retail and small and medium enterprises (SME) segments are under the Bank Negara’s repayment moratorium until Oct 1, 2020.

The group’s gross loans and financing base expanded 5.3 per cent y-o-y to RM107.2 billion with diversified growth in all segments and products, barring auto finance.  With the exclusion of auto finance, the group’s gross loans grew 8.7 per cent in FY20. 

Mortgage loans, the main driver of loans growth, increased by RM2.4 billion or 7.0 per cent during the year. This was followed by loans to the SME and mid corporate segments, business banking loans was up 12.9 per cent, mid corporate 9.5 per cent and retail SME 34.8 per cent.

The group’s customer deposits grew in line with gross loans and financing, with an increase of 5.7 per cent y-o-y to RM113.0 billion.

Current and savings account (Casa) balances registered robust growth of 15.9 per cent y-o-y to RM28.8 billion, with Casa mix higher at 25.5 per cent (FY19: 23.3 per cent). 


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