AmBank Group’s Q3 net profit increases to RM452.64m

KUALA LUMPUR: AMMB Holdings Bhd’s (AmBank Group) net profit for the third quarter of financial year 2023 (Q3’23) increased to RM452.64 million from RM403.29 million in Q3’22.

For the quarter ended Dec 31, 2022, revenue stood higher at RM1.23 billion compared with RM1.18 billion previously.

The group attributed its improved performance to an increase in fund-based income from interest-bearing assets, mainly from interest on customer lending and fixed-income securities.

In a statement today, AmBank Group CEO Datuk Sulaiman Mohd Tahir said the group has delivered resilient results with sustained growth in profit and income amid macroeconomic headwinds.

“Key divisions performed well, underpinned by solid loan growth and net interest margin expansion,” he said.

Meanwhile, for the cumulative nine months of FY23 (9M’23), the group’s total income stood at RM3.57 billion, underpinned by a 10.3% increase in net interest income to RM2.71 billion on the back of higher loan growth and net interest margin expansion.

However, this was offset by a RM217.8 million reduction in non-interest income, mainly due to the disposal of AmGeneral Insurance Bhd (AmGen) to Liberty Insurance Bhd.

Its net profit for 9M’23 was higher at RM1.30 billion compared with RM1.11 billion in 9M’22, while revenue rose to RM3.57 billion from RM3.54 billion previously.

During the period, the group recorded a net impairment charge of RM416.1 million, inclusive of AmGen’s net impairment of RM113.2 million.

This was 41.8% lower compared with the RM714.6 million charge recorded in 9M’22, mainly attributable to non-repeat of provisions taken on oil and gas exposures in 9M’22 for wholesale banking as well as lower overlays, it said.

Overall gross loans and financing grew robustly by 5.3% or RM6.3 billion year-to-date to RM126.3 billion, with well-diversified growth across all business segments.

Loans in retail banking rose to RM3.3 billion (+4.8%), while loans in wholesale banking expanded to RM1.6 billion (+5.2%) and business banking grew to RM1.3 billion (+7.1%).

Deposits from customers grew 1.4% to RM124.3 billion (FY22: RM122.6 billion), supported by consistent growth in retail deposits.

“The group remains well capitalised, with the results of stress testing indicating that the group has sufficient loss absorption capacity to maintain capital ratios above both regulatory requirements and internal capital targets,” AmBank said.

On its outlook, AmBank said it remains on track to deliver strong financial performance throughout FY23, benefiting from the rising demand for financing, the rise in the overnight policy rate and lower provisions due to an improving economy.

“The year 2022 was, by and large, a positive one economically, as evidenced by the 8.7% gross domestic product growth.

“As a knock-on effect of the local economic revival that is well supported by domestic demand, considering the much-improved local employment and income landscape, the banking sector should do well going into 2023,” Sulaiman said in the statement.