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Lower loan impairments help push RHB Bank Q1 profit up YOY

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Lower loan impairments help push RHB Bank Q1 profit up YOY

Malaysia's RHB Bank Bhd. posted an 18.1% year-over-year increase in net profit for the quarter ended March 31 amid lower allowances for credit losses.

The bank said May 31 that net profit attributable to equity holders rose to 590.8 million Malaysian ringgit from 500.3 million ringgit in the prior-year period. EPS climbed to 14.7 sen from 12.5 sen.

The company noted that loan and financing growth, as well as higher net forex gains and trading and investment income, also contributed to improved results for the March quarter.

Net interest income for the period grew to 928.9 million ringgit from 851.6 million ringgit, while income from the Islamic banking business increased to 273.8 million ringgit from 250.0 million ringgit. Net fee and commission income declined to 259.3 million ringgit for the quarter from 268.8 million ringgit in the previous year.

Meanwhile, allowance for credit losses slipped to 114.5 million ringgit from 136.0 million ringgit, as one-off impairments on certain oil and gas sector-related corporate accounts were taken in the prior-year quarter.

As of March 31, the bank's gross impaired loans ratio slipped to 2.29% from 2.39% a year ago.

Before proposed dividends, the group's total capital ratio came in 16.971% as of March 31, down from 17.500% at the end of 2017. Its Tier 1 and common equity Tier 1 ratios for the period stood at 14.010% and 13.805%, respectively, down from 14.485% and 14.228% as of Dec. 31, 2017.

After proposed dividends, the group's total capital adequacy ratio slipped to 16.653% at the end of March from 17.179% in the previous quarter. Its Tier 1 and common equity Tier 1 ratios came in 13.693% and 13.487%, respectively, both down from 14.164% and 13.907% at the end of December 2017.

As of May 30, US$1 was equivalent to 3.99 Malaysian ringgit.