KUALA LUMPUR, May 26 (Bernama) -- RHB Bank Bhd’s net profit for the first quarter ended March 31, 2023 (1Q 2023) rose 30.8 per cent to RM761.67 million from RM582.33 million registered in the same quarter last year, attributed mainly to higher non-fund based income and lower expected credit losses (ECL).
Revenue increased to RM3.92 billion from RM2.81 billion previously, it said in a filing to Bursa Malaysia.
Non-fund-based income increased by 39.7 per cent to RM534.0 million, primarily from the higher net gain on foreign exchange and derivatives, and higher net trading and investment income, it said in a separate statement filed with the exchange.
RHB Bank said ECL decreased by 70.1 per cent to RM46 million from lower ECL on loans and net writeback for ECL on securities, and correspondingly, the annualised credit charge ratio improved to 0.10 per cent compared with 0.29 per cent for the same period last year.
The bank also noted that the net fund-based income, however, declined by 6.6 per cent to RM1.37 billion on the back of higher funding costs, attributed mainly to fixed deposits growth of 9.9 per cent year-on-year (y-o-y) while net interest margin for the quarter was 1.90 per cent compared with 2.16 per cent recorded in 1Q 2022.
The group reported that its gross loans and financing for 1Q 2023 grew six per cent y-o-y to RM213.4 billion, mainly supported by growth in mortgage, auto finance, small and medium enterprises and Singapore businesses. Domestic loans and financing grew 4.7 per cent y-o-y.
Gross impaired loans as of March 2023 stood at RM3.4 billion with gross impaired loans ratio of 1.59 per cent compared with RM3.3 billion and 1.55 per cent respectively as of December 2022.
Customer deposits remained stable y-o-y at RM226.4 billion, attributed to growth in fixed deposits of 9.9 per cent with current account savings account composition standing at 28.1 per cent. Liquidity coverage ratio remained sound at 147.3 per cent as at March 31, 2023.
Group managing director/group chief executive officer Mohd Rashid Mohamad said the domestic banking sector is projected to remain resilient with strong fundamentals while the monetary policy remains accommodative, displayed by the recent normalisation of the overnight policy rate to three per cent.
“We remain focused on strengthening our balance sheet and will continue to uphold our strong capital and liquidity positions,” he said.
From a sustainability standpoint, he said RHB Bank has achieved more than RM3 billion in Sustainable Financial Services for 1Q 2023 and is on track to achieving its 2026 aspirations under Sustainability Strategy and Roadmap.
“With a cumulative achievement of more than RM14 billion in Sustainable Financial Services, equivalent to 73 per cent of our 2026 target of RM20 billion, we will continue to intensify our efforts in integrating environmental, social and governance considerations into our business and decision-making process,” he added.
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