MBSB 4Q net profit down 4.86% on lower impairment charges

TheEdge Fri, Mar 01, 2019 11:03am - 5 years View Original


KUALA LUMPUR: Malaysia Building Society Bhd’s (MBSB) net profit for the fourth quarter of financial year 2018 (4QFY18) ended Dec 31, 2018 fell 4.86% to RM117.96 million, from RM123.98 million a year earlier, due to lower charges in impairment allowance on loans and financing.

The lower charges, the group said, stemmed from a staging improvement in its corporate portfolio for both stage 1 and stage 2 under the Malaysian Financial Reporting Standards, as well as a higher impairment in FY17.

Quarterly revenue was down 8.3% to RM750.35 million, from RM818.27 million previously.

Full-year net profit jumped 54% to RM642.4 million, from RM417.13 million in FY17. However, full-year revenue dipped 3.49% to RM3.15 billion from RM3.26 billion.

In a separate statement, the group said its gross financing and loans went up by 2.84% to RM35.17 billion in FY18 from RM34.2 billion in FY17.

Total assets stood at RM45.42 billion compared with RM44.81 billion in FY17, and net impaired financing ratio stood at 2.39%, compared with 2.11% for FY17. This increase, the group said, was due to impairment allowance write-backs mainly for its corporate portfolio.

“2018 was an eventful year for us as we completed the successful acquisition of Asian Finance Bank Bhd on Feb 7, 2018,” MBSB president and chief executive officer Datuk Seri Ahmad Zaini Othman said in the statement.

“We only merged the business and operations of the two entities on April 2, 2018. From then on, we began implementing our plans to build up the core banking capabilities for the new merged entity,” he said.

On the group’s FY18 performance, Ahmad Zaini said 95% of its income was derived from the existing lines of business and the remaining 5% from new offerings.

He said the group is aware of the challenges in FY19 and that it will try to maintain its technology transformation plans, allowing it to extend its market reach, particularly in the small and medium enterprise segment, as well as greater emphasis on fee income from its retail segment.

Shares in MBSB closed unchanged at RM1.04 yesterday, giving the group a market capitalisation of RM6.64 billion.

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