KUALA LUMPUR: CIMB Group Holdings Berhad (“CIMB Group” or “the Group”) today announced robust growth for the first quarter ended 31 March 2024 (“1Q24”), with profit before tax (“PBT”) rising 15.1% YoY to RM2.57 billion. Net profit also saw a significant increase of 17.7% YoY to RM1.94 billion, driven by strong operating income and managed costs and provisions. This resulted in an annualised return on equity (“ROE”) of 11.4%, up from 10.3% in 1Q23, and earnings per share (“EPS”) of 18.2 sen.
Operating income for 1Q24 grew by 12.6% YoY to RM5.63 billion, with net interest income (“NII”) up 7.7% YoY to RM3.79 billion due to strong loan growth and net interest margin (NIM) recovery. Non-interest income (“NOII”) increased by 24.5% YoY to RM1.84 billion, driven by capital markets, investment-related income, and gains from the sale of non-performing loans.
Total gross loans increased by 7.0% YoY, particularly in Singapore, which saw a 13.1% YoY rise. Deposits grew by 8.2% YoY, propelled by a 16.8% increase in CASA deposits, improving the CASA ratio to 40.8% in March 2024 from 37.9% in March 2023.
The Group’s cost-to-income ratio improved to 45.3%, benefiting from the strong operating income growth which offset an 8.9% YoY rise in operating expenses due to inflationary pressures and technology investments. Provisions were contained at RM503 million, with a credit cost of 35 basis points (bps) compared to 37 bps in 1Q23.
On a quarter-on-quarter (QoQ) basis, PBT and net profit improved by 10.4% and 12.9% respectively, driven by a 4.7% increase in operating income and a 2.8% reduction in operating costs, though partially offset by a 26.1% increase in provisions due to the absence of overlay writebacks from the previous quarter.
CIMB Group’s capital position remained strong, with a CET1 ratio of 15.0% as at end-March 2024, up from 14.3% a year earlier and 14.5% at the end of December 2023.Dato’ Abdul Rahman Ahmad, Group Chief Executive Officer of CIMB Group, stated, “Our strong performance in the first quarter reflects a positive start to the financial year amidst challenging global conditions. Our revenue growth, coupled with managed costs and provisions, underscores the effectiveness of our ASEAN diversification strategy.”
Consumer Banking: Operating income grew 9.6% YoY with NII up 9.4% and NOII up 9.9%. PBT fell 10.3% due to higher expenses and provisions.
Commercial Banking: Operating income increased by 1.7% YoY, with a 3.3% NII growth. PBT rose 9.1% YoY due to lower provisions.
Wholesale Banking: Operating income grew 15.0% YoY, driven by a 43.3% increase in NOII. PBT expanded by 40.2% YoY.
Digital Assets & Group Funding: Operating income rose 42.4% YoY, with PBT up 25.5% YoY, supported by strong growth in CIMB’s digital businesses.
CIMB Islamic:*Operating income increased 15.1% YoY, with PBT up 46.8% YoY due to a recovery in Islamic finance.
Dato’ Abdul Rahman expressed cautious optimism for the year, noting the challenges posed by global economic headwinds but highlighting the Group’s resilience and strong performance in key markets. He emphasized CIMB’s commitment to its Forward23+ strategic plan and ESG goals, aiming to achieve a cumulative RM100 billion in sustainable finance by FY24.
The Group is poised to continue its focus on strengthening its deposit and CASA franchise, managing NIM, expanding NOII, and enhancing technology and operational resilience to drive sustained growth and deliver on its FY24 targets.
