PETALING JAYA: Malaysia Building Society Bhd’s (MBSB) net profit for the fourth quarter ended Dec 31, 2018 fell 4.9% to RM117.96 from RM123.98 million a year ago mainly due to lower charge of impairment allowances on loans and financing.
The lower charge was mainly due to improvement of staging from corporate portfolio for both Stage 1 and Stage 2 under Malaysian Financial Reporting Standards 9 and higher 2017 impairment following the impairment programme.
Its revenue also dropped 8.3% to RM750.35 million from RM818.27 million.
For the full-year period, MBSB’s net profit surged 54% to RM642.40 million from RM417.13 million a year ago due to lower impairment allowances; while revenue was 3.5% lower at RM3.15 billion compared with RM3.26 billion in FY17.
MBSB’s net profit margin stood at 3.06% (FY18), consistent with 3.08% (3Q18) mainly contributed by personal financing, corporate and global market portfolios.
On the group’s 2018 performance, MBSB group president and CEO Datuk Seri Ahmad Zaini Othman said 95% of 2018’s income was derived from the existing lines of business and the remaining 5% from new offerings.
Gross financing and loans trended upwards by 2.84% from RM34.2 billion (FY17) to RM35.17 billion (FY18) and consistent with RM35.85 billion (3Q18). Net impaired financing ratio stood at 2.39% (FY18) compared to 1.76% (3Q18) and 2.11% (FY17). The increase was due to impairment allowance write backs mainly for corporate portfolio in 4Q18.
The group’s deposit remains consistent with growth of 1.01% at RM32.78 billion (FY18) compared to RM32.76 billion (FY17). Liquidity coverage ratio stood at 210.33% (4Q18) from 154.96% (3Q18) due to higher stock of high quality liquid assets as well as lower total net cash outflows. Capital position remains strong as common equity tier 1 capital ratio stood at 20.096% as at Dec 31, 2018.
On 2019 outlook, Zaini said it takes cognizant of the challenges this year, economic and other factors but will keep to the technology transformation plans as these are key to ensuring its ability to compete in the industry.
“With new capabilities and channels, we shall be able to extend our market reach especially in the SME segment through products such as trade finance. Greater emphasis shall also be placed on fee income to be attributed from the retail segment.”
Source: The Sun Daily