31/05/2024 07:26 PM

KUALA LUMPUR, May 31 (Bernama) -- CIMB Group Holdings Bhd’s net profit for the first quarter ended March 31, 2024 (1Q 2024) rose 17.7 per cent to RM1.94 billion from RM1.64 billion in the same quarter last year.

The banking group’s revenue increased to RM5.63 billion from RM5 billion previously.

CIMB said the group’s better net profit was driven by strong operating income growth and contained costs and provisions.

The bank said the first quarter operating income rose 12.6 per cent year-on-year (y-o-y) to RM5.63 billion, driven by both net interest income (NII) and non-interest income (NOII) growth.

"NII grew by 7.7 per cent y-o-y to RM3.79 billion attributed to the robust loan growth and net interest margin (NIM) recovery in the banking book, while NOII grew 24.5 per cent to RM1.84 billion, supported by strong capital markets and investment-related income, as well as gains from the sale of non-performing loans," it said in a statement.

CIMB said total gross loans also increased seven per cent y-o-y across key markets and segments, especially in Singapore which grew 13.1 per cent. Deposits increased by 8.2 per cent y-o-y, driven by the strong 16.8 per cent current account savings account (CASA) growth, which translates to an improved CASA ratio of 40.8 per cent in March 2024 versus 37.9 per cent in March 2023.

The bank also noted that its cost-to-income ratio improved y-o-y to 45.3 per cent, attributed to the robust operating income expansion which offset the 8.9 per cent increase in first quarter operating expenses from inflationary pressures and technology investments.

Meanwhile, total provisions were contained at RM503 million with credit cost at 35 basis points (bps) compared to 37 bps recorded in 1Q 2023.

CIMB said the group’s capital position remained strong and above target with its common equity tier 1 ratio at 15.0 per cent as at end March 2024, up from 14.3 per cent as at end March 2023 and 14.5 per cent as at end December 2023.

Commenting on the performance, group chief executive officer  Datuk Abdul Rahman Ahmad said the strong performance seen in the first quarter reflects a positive start to the financial year amid the challenging and uncertain global environment. He noted that CIMB’s “positive revenue growth, contained cost and provisions contributed to the strong performance, especially from Malaysia and Singapore, underpinning the strength of our Asean diversification strategy.”

"Focused execution of initiatives under our Forward23+ strategic plan continues to bear positive results, with strong CASA growth and recovering NIM from our deposit-led strategy, which helped drive better NII performance,” he added.

Moving forward, Abdul Rahman said the group has maintained a cautious outlook for the year given the global economic headwinds with heightened geopolitical pressures, the likelihood of prolonged elevated interest rates and a competitive banking industry operating environment.

"However, we expect our key operating markets to be resilient and well-positioned to capture economic growth, especially from the positive impact of increased tourism economy.

"Barring unforeseen circumstances, the group is optimistic of being on track to deliver on its financial year 2024 targets on the back of positive performance from Malaysia and Singapore," he added.



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