KUALA LUMPUR (Feb 27): RHB Bank Bhd (KL:RHBBANK) posted a 42.45% increase in net profit for the final quarter of last year, driven by higher net interest income and lower allowances for credit losses.
Net profit at Malaysia’s fourth-largest lender by assets for the three months ended Dec 31, 2024 (4QFY2024) was RM834.54 million, versus RM585.91 million in 4QFY2023, according to a bourse filing. Earnings per share rose to 19.14 sen from 13.67 sen previously.
The bank declared a second interim dividend of 28 sen per share for FY2024, bringing the total dividend payout for the full year to 43 sen per share — its highest ever for a financial year.
The group had been paying a 40 sen per share dividend for three consecutive years since FY2021.
Quarterly revenue rose to RM4.58 billion from nearly RM4.4 billion.
Net interest income rose 10.39% year-on-year (y-o-y) to RM957.18 million from RM867.22 million, while non-interest income declined by 36.15% to RM397.87 million from RM623.22 million.
Income from Islamic banking operations jumped 60.37% y-o-y to RM855.60 million from RM533.60 million a year ago.
The bank’s allowances for credit losses on financial assets dropped 67.93% y-o-y to RM73.76 million, compared with RM230.12 million in 4QFY2023.
Its net interest margin — a measure of profitability from interest charged on loans after paying returns on deposits — expanded y-o-y by four basis points to 1.86%, thanks to the bank’s liability management initiatives.
For FY2024, net profit grew 11.16% to a record high of RM3.12 billion, compared with RM2.81 billion in FY2023.
Net interest income for FY2024 was up 8.69% at RM3.87 billion from RM3.56 billion FY2023, as non-interest income jumped 38.77% to RM2.56 billion from RM1.84 billion.
“As we look ahead, our new corporate strategy will focus on accelerating digital transformation and driving innovation to create seamless, customer-centric banking experiences,” RHB group managing director and group chief executive officer Datuk Mohd Rashid Mohamad said in a statement.
“This strategic shift will ensure that RHB remains agile, competitive, and well-positioned to meet the evolving needs of our customers in a rapidly changing financial landscape,” he said.
RHB also expects the banking sector to remain resilient in FY2025, supported by strong capital and liquidity positions, despite the uncertainties surrounding the US policy direction and geopolitical tensions.
Deposits from customers rose 2.04% to RM250 billion, with current-account-savings-account (Casa) making up 27.6% of total deposits.
Gross loans grew 6.9% y-o-y to RM238 billion, supported by a growth of 6.5% in community banking, 8.9% in wholesale banking and 8.3% in its Singapore segment.
Gross impaired loans ratio improved to 1.47% from 1.74% in FY2023, largely due to the resolution of distressed corporate borrowers. Loan loss coverage ratio rose to 115.5% and up to 78.6% without regulatory reserves.
RHB’s common equity Tier 1 capital — a measure of a bank’s capital strength based on the highest quality of regulatory capital — stood at 16.4%, with the total capital ratio at 19%.
At the midday break on Thursday, RHB shares were up four sen or 0.6% at RM6.68, valuing the group at RM29.12 billion.–THE EDGE
