21/05/2024 03:19 PM

KUALA LUMPUR, May 21 (Bernama) -- Bank Islam Malaysia Bhd’s net profit for the first quarter ended March 31, 2024 (1Q 2024) rose 9.4 per cent to RM129.17 million from RM118.09 million in the same quarter a year ago.

The higher net profit was driven by higher net income and lower net allowance for impairment on financing, offset by higher total overheads.

In a filing with Bursa Malaysia, the bank said that its revenue also increased 3.7 per cent to RM1.14 billion versus RM1.10 billion previously.

It said the increase in the group’s net income was mainly due to higher net fund-based income, which improved by RM26.9 million or 5.4 per cent, driven by year-on-year (y-o-y) financing and investment securities growth.

“The increase facilitated an eight basis point improvement in the net income margin (NIM), reaching 2.14 per cent for 1Q 2024 compared to 2.06 per cent recorded in 1Q 2023.

“However, the group’s non-fund-based income decreased by RM16.5 million or 15.6 per cent, stemming from lower investment income during the period under review,” it said. 

According to Bank Islam, its net allowance for impairment on financing and advances grew by 31.8 per cent to RM42.3 million versus the same period last year.

It said total overheads for 1Q 2024 rose 4.1 per cent to RM371.3 million compared to 1Q 2023 as the group continues to invest in human capital, digital, and technology initiatives.

“As of March 31, 2024, the group’s total assets stood at RM91.0 billion, spurred by the growth in financing and investment securities, offset by the reduction in cash and short-term funds. Net assets per share amounted to RM3.29,” it noted.

Meanwhile, the bank stated that gross financing grew by 2.4 per cent y-o-y to RM67.8 billion, while customer deposits and investment accounts stood at RM76.4 billion.

“Current and saving and transactional investment accounts (CASATIA) remain robust, amounting to RM30.6 billion at the end of March 2024, constituting 40.1 per cent of the total customer deposits and investment accounts.

“The healthy ratio emphasises the group’s prudent liquidity management practices and ability to meet its customer base’s diverse financial requirements,” it said. 

As of March 31, 2024, the gross impaired financing ratio was 0.95 per cent and remained below the industry average of 1.62 per cent, while its total capital ratio remained strong at 19.6 per cent, it noted.

Group chief executive officer Datuk Mohd Muazzam Mohamed said the bank will continue prioritising fundamentals and focusing on balance sheet discipline amid economic uncertainties.

He said the group will also actively support implementing new business models to diversify customer solutions by offering innovative products and services, setting the bank apart in the competitive market.

“Moreover, we aim to enhance our non-fund-based income and accelerate financing growth while expanding wealth management offerings and solidifying our position in the retail market,” he said.

Mohd Muazzam added the bank will also focus on fostering growth in CASATIA, leveraging strategic partnerships, and promoting cashless transactions, especially within the retail and small and medium enterprise sectors.

Moving forward, Bank Islam said it expects improved earnings growth as it expands its financing volume, while NIM is projected to stabilise, supported by sustained efforts and the maintained overnight policy rate.

“Central to the bank’s strategy is the meticulous management of NIM, focusing on rebalancing the funding composition. Both retail and non-retail portfolios are poised to propel financing growth for the year.

“Beyond financial performance, Bank Islam’s effort to bolster the green economy was yielding results, as its green financing exceeded the initial target of RM4 billion by 2025 to RM4.59 billion as of March 31, 2024,” it added.




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