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Hong Leong Financial, banking unit post YOY increases in fiscal Q4 profits

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Hong Leong Financial, banking unit post YOY increases in fiscal Q4 profits

Hong Leong Financial Group Bhd. reported a 3.2% year-over-year increase in net profit for the fiscal quarter ended June 30.

The group said fiscal fourth-quarter net profit attributable to owners rose to 468.7 million Malaysian ringgit, or 41 sen per basic share, from 454.3 million ringgit, or 39.7 sen per basic share.

Net interest income grew to 723.7 million ringgit from 689.7 million ringgit, while income from the group's Islamic banking business increased to 175.0 million ringgit, from 162.7 million ringgit in the prior-year quarter.

The group's operating profit before allowances dropped to 726.3 million ringgit from 748 million ringgit. Allowance for impairment losses on loans, advances and other losses swelled to 47.2 million ringgit from 10.7 million ringgit.

The group's net profit for the full year rose 0.6% to 1.92 billion ringgit, or 1.68 ringgit per basic share, from 1.91 billion ringgit, or 1.67 ringgit per basic share. The fiscal full-year S&P Global Market Intelligence consensus estimate for normalized EPS was 1.71 ringgit, while the consensus estimate for GAAP EPS was 1.74 ringgit.

Hong Leong Financial raised its total dividend for the full year to 42 sen per share from 40 sen per share.

Hong Leong Bank Bhd. said its net profit for the fiscal fourth quarter rose 1.7% year over year to 636.4 million ringgit, or 31 sen per share, from 626.0 million ringgit, or 30.6 sen per share.

Net interest income fell to 668.3 million ringgit from 690.4 million ringgit. Net income from the Islamic banking business rose to 175 million ringgit from 162.7 million ringgit. Operating profit before allowances fell to 637.8 million ringgit from 665.5 million ringgit. The bank's allowance for impairment losses swelled to 47 million ringgit from 9.8 million ringgit.

The group and the lender's gross impaired loans ratio came in at 0.8% as of June 30, compared to 0.9% as of June 30, 2018.

For the full year ended June 30, the bank's net profit attributable to owners rose 1% to 2.66 billion ringgit from 2.64 billion ringgit. EPS was 1.30 ringgit, up from 1.29 ringgit.

The S&P Global Market Intelligence consensus normalized estimate for the fiscal year was 1.28 ringgit, while the consensus estimate for GAAP EPS was 1.30 ringgit.

As of June 30, the bank's consolidated total capital adequacy ratio before deducting proposed dividends was 16.203%, down from 16.301% at June 30, 2018. Its common equity Tier 1 and Tier 1 capital ratios were 13.266% and 14.074%, respectively, compared to 12.545% and 12.997%, respectively, at the end of June 2018.

After deducting proposed dividends, the bank's consolidated total capital adequacy ratio was 15.577%, down from 15.706% at June 30, 2018. Its common equity Tier 1 and Tier 1 capital ratios were 12.640% and 13.448%, respectively, up from 11.949% and 12.401%, respectively, at the end of June 2018.

The bank's board recommended a final dividend of 34 sen per share, up from 32 sen per share in the prior-year dividend. The bank's total dividend for the full year, including an interim dividend of 16 sen per share, rose to 50 sen per share from 48 sen per share.

As of Aug. 27, US$1 was equivalent to 4.20 Malaysian ringgit.