Maybank Group Records Pre-Tax Profit of RM1.509 Billion
28 August 2001
The Maybank Group today announced a pre-tax profit of RM1.509 billion for the year ended 30 June 2001. This was a decline of 29.3% from the RM2.137 billion in the previous year. Net profit for the Group declined 38% from RM1.36 billion to RM839.6 million.
At the Bank level, pre-tax profit for the year declined from RM1.544 billion to RM1.435 billion. Net profit was RM901.1 million against RM1.02 billion previously.
The results of the Group according to business groups were as follows :–
|Business Group||30/06/2000 |
|*Banking Group including overseas subsidiaries||1143.4||1427.3|
|Investment Banking Group||(125.8)||194.8|
|Asset Management Group||19.5||27.4|
*excludes dividends to the Bank from subsidiaries
In announcing the results today, Maybank Managing Director, Datuk Amirsham A Aziz said that the decline arose mainly due to additional loan loss and provisions arising from deterioration in asset quality and increase in overhead costs arising from the merger, which was earlier expected.
As a result of the merger and organic growth, the Bank grew its market share in loans and deposits. The Bank's market share for loans rose from 19.3% in December 2000 to 22.8% in June 2001. Market share for savings deposits rose from 23.7% to 33% and that for demand deposits rose from 21% to 23%. Total traditional deposit market share for the Bank also rose from 15% to 20% within a period of 6 months.
Loan loss and provisions charged during the year at the Group level was RM1.995 billion against RM1.522 billion, while at the Bank level it was RM1.312 billion against RM849.6 million previously.
Mayban Finance recorded a 21% increase in pre-tax profit to RM504 million, mainly due to an increase in net interest income as well as lower loan loss and provision. Aseambankers recorded a pre-tax loss of RM151.5 million which was attributed to lower revenues as well as higher loan loss and provision.
Mayban Securities' performance was affected by the lower volumes due to weak equity market sentiments as well as lower commissions from the downward revision in brokerage fees. Its pre-tax profit declined from RM82.33 million to RM12.35 million this year.
Pre-tax profit for Mayban Discount also saw a decline from RM110 million to RM39 million owing to narrowing of interest margins following the re-pricing of substantial portions of its investment portfolio, and higher provisions arising from the defaults of some corporate bonds.
The life insurance business remained profitable with a pre-tax profit of RM17.7 million. The general insurance business, however, recorded a loss of RM23.5 million. This was due to increased provisions, higher claims and reduction in tariff rate for Fire class.
The Group's overseas operations recorded a pre-tax profit of RM29 million against RM200.4 million previously, as it was impacted by the difficult operating conditions in Indonesia and the economic slowdown in Singapore.
Loans growth for the Group was 20.8% while that for the Bank was 25.7%. For Maybank's domestic operations, organic loan growth was 8.6% against the industry rate of 6.1%.
The Bank's net NPL ratio as at June 2001 was 6.99% compared to 4.29% in June 2000 while that for the Group was 7.74% from 5.64% earlier. Reserve cover was 64% for the Group and 65.5% for the Bank against the industry of 47.4% and 49.2% respectively.
The risk weighted capital ratios of the Group and Bank as at 30 June 2001 was 13.05% and 11.61% respectively, well above the international minimum standard of 8%.
Given the expected improvement in the country's economy during the coming financial year, the Group anticipates the business environment to be more conducive. This, together with the initiatives to improve productivity and efficiency, will further enhance the Group's financial strength and leadership standing in the industry. Furthermore, the benefits arising from the recently completed mergers are expected to be realised in the coming years.
The Board has recommended a final dividend of 7 sen per share less 28% income tax. The Board has also recommended a bonus issue of 1 for 2 subject to all the necessary shareholder and regulatory approvals.