KUALA LUMPUR: Hong Leong Bank Bhd 's net profit fell by 8.1% to RM633.89mil from RM690.03mil a year ago due to lower net income but mitigated by lower operating expenses, lower allowance for impairments and higher share of profit from associated company.It announced on Tuesday its revenue fell by 7.1% to RM1.166bil from RM1.256bil. Earnings per share were 30.98 sen compared with 33.73 sen.For the nine months, its net profit rose by 0.8% to RM2.028bil from RM2.012bil in the previous corresponding period. Its revenue fell by 2.8% to 3.558bil from RM2.663bil.Hong Leong Bank group managing director and CEO Domenic Fuda said: “Despite on-going economic challenges, loan growth momentum for Hong Leong Bank accelerated to a healthy 6.5% y-o-y expansion to RM133.6bil, whilst continuing to uphold its solid asset quality, signifying the bank’s commitment towards delivering on sustainable results to our stakeholders.“Net profit after tax for the third quarter and nine months achieved RM634mil and RM2.028bil respectively, attributed to a healthy expansion in loan book despite lingering concerns in the operating environment, outstanding asset quality as well as consistently strong contribution from our associates,” he said.Fuda said Q3 saw a pick-up in net interest margin to 2.00%, up 2bps on prior quarter. He added this positive performance reflected the bank's commitment to further enhance product offerings, such as the recent launch of its co-branded Emirates HLB cards aimed at accelerating growth in its payments’ business by leveraging on the growing Malaysian travel segment.Total income for 9MFY19 stood at RM3.558bil, driven mainly by a healthy growth in loan book.Net interest income for 9MFY19 was lower at RM2.574bil on the back of still elevated funding cost pressure during the period under review.Correspondingly, net interest margin (NIM) for 9MFY19 fell to 1.98% compared with the corresponding nine months. Its reported SME portfolio increased by 1.1% y-o-y to RM20.9bil, wherein our community banking initiative continues to deliver promising growth of 34.1% y-o-y and 10.3% q-o-q.Domestic loans to the retail segment remains the key growth driver, expanding 6.3% y-o-y, making up 71% of the bank’s total loans.Residential mortgages grew ahead of industry at 9.4% y-o-y to RM65.9bil, sustained by a healthy loan pipeline and steady approvals while transport vehicle loans was stable with a 0.8% y-o-y growth to RM17.1bil, also ahead of industry.Loans and financing from overseas operations continues to grow at a healthy pace of 6.5% y-o-y, driven by growth in Cambodia and Vietnam, which increased 28.4% and 62.1% y-o-y respectively.

Source: The Star May 28, 2019 05:26 UTC