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Hong Leong Financial posts YOY decline in fiscal Q3 net profit

Hong Leong Financial Group Bhd. posted a year-over-year decline in net profit for the fiscal third quarter ended March 31 as a rise in interest expense resulted in a decline in net interest income.

The group on May 28 reported a fiscal third-quarter net profit attributable to owners of 463.4 million ringgit, down from 502.6 million ringgit in the prior-year period. Basic EPS declined to 40.5 sen from 43.9 sen.

Net interest income for the quarter fell to 687.0 million ringgit from 705.7 million ringgit amid a rise in interest expense to 1.04 billion ringgit from 914.2 million ringgit. Net income from Islamic banking business climbed to 188.5 million ringgit from 166.7 million ringgit.

Net income declined to 1.31 billion ringgit from 1.39 billion ringgit. Operating profit before allowances fell to 707.3 million ringgit from 793.8 million ringgit.

Allowance for impairment losses on loans, advances and financing and other losses amounted to 4.6 million ringgit, down from 12.6 million ringgit in the prior-year quarter.

For the nine-month period ended March 31, Hong Leong Financial posted a net profit attributable to owners of 1.45 billion ringgit, remaining flat from the prior-year period.

Hong Leong Financial's board declared a second interim dividend of 29 sen per share for the fiscal year, up from the prior fiscal year's dividend of 27 sen per share.

Together with a first interim dividend of 13 sen per share, the group's total dividend for the fiscal year amounted to 42 sen per share, up from 40 sen per share in the prior-year period.

Hong Leong Bank Bhd., a unit of the group, posted a year-over-year decline in fiscal third-quarter net profit to 633.9 million ringgit from 690.0 million ringgit. EPS fell to 30.9 sen from 33.7 sen.

For the nine-month period ended March 31, Hong Leong Bank posted a net profit attributable to owners of 2.03 billion ringgit, up from 2.01 billion ringgit in the prior-year period.

As of March 31, Hong Leong Bank's total capital ratio, Tier 1 ratio and common equity Tier 1 ratio before deducting proposed dividends were 16.432%, 13.232% and 12.426%, respectively. The ratios were 16.301%, 12.997% and 12.545%, respectively, as of June 30, 2018.

As of May 27, US$1 was equivalent to 4.19 Malaysian ringgit.