Highlight Public Bank 4Q net profit up 4.4% y-o-y, declares 30 sen dividend

Highlight Public Bank 4Q net profit up 4.4% y-o-y, declares 30 sen dividend
Business & Markets 2014
Written by Ahmad Naqib Idris Adzman Shah of theedgemalaysia.com
Wednesday, 05 February 2014 13:46

KUALA LUMPUR (Feb 5): Public Bank Bhd reported a net profit of RM1.03 billion for its fourth quarter, up 4.4% from RM981.84 million posted in the previous year’s corresponding quarter.

Revenue for the quarter also rose in tandem, up by 8% to RM3.919 billion from RM3.630 billion.

Public Bank announced a second interim dividend of 30 sen per share for the year ended Dec 31, 2013, which will go ex on Feb 18, 2014, and payable on Feb 28.

“The improved earnings was mainly due to higher net interest income and higher net fee and commission income, partially offset by higher other operating expenses and lower other operating income,” said the group in its statement to Bursa Malaysia.

Its retail operations, corporate lending, investment banking and fund management business segments had recorded higher pre-tax profit during the quarter, while its hire purchase, treasury and capital market operations and overseas operations saw lower profits.

Cumulatively, the 2013 full year net profit increased to RM4.065 billion from RM3.827 billion in 2012, while revenue rose to RM15.264 billion from RM14.058 billion in 2012.

Going forward, the group said it maintained a positive economic outlook on the Malaysian banking sector, and would continue to strengthen its regional presence through organic growth.

“The group will continue to transfer the best practices from its domestic operations to expedite business growth in its overseas operations,” said Public Bank.

It expects to sustain its strong market position in the domestic retail operations segment, while also expanding its corporate lending business, fund management business, and vehicle hire purchase business.

“Given the possibility of continued market volatility in 2014, the Public Bank Group will continue to focus on maintaining a healthy level of liquidity by increasing its investments in high grade liquefiable assets,” said the group.

In a separate statement, chairman of Public Bank Tan Sri Teh Hong Piow said: “The group’s net profit attributable to shareholders (for 2013) grew by 6.2% to RM4.06 billion, exceeding the RM4 billion mark for the first time.”

He claimed the group achieved the highest return on equity of 22.4% in the local banking sector, while maintaining the lowest gross impaired loan ratio of 0.7% and cost to income ratio of 30.7% in 2013.

Teh added: “In view of the group’s favourable performance in 2013, the board of directors has declared a second interim single-tier dividend of 30 sen. Together with the first interim single-tier dividend of 22 sen, the total dividend for 2013 is 52 sen.”

He noted that in 2013, the Public Bank group was able to record “healthy growth” of 11.8% and 11.5% in loans and deposits respectively despite intense competition and new regulatory measures.

“In particular, the growth for domestic loans of 12.0% outpaced the domestic banking industry’s growth of 10.6%,” said the founder of the banking group.

He said the group continued to sustain its market leadership position in domestic lending for residential mortgages, commercial property financing and passenger vehicles financing, with market shares at 19.6%, 33.8% and 26.5% respectively.

On asset quality, Teh said: “The Public Bank group's loan loss coverage ratio stood at 118.5%, which was higher and more prudent than the banking industry's average loan loss coverage ratio of 107.6%.”

On outlook, he said the group was “well-positioned to weather any uncertainty in 2014 and beyond”.

“The group is expected to maintain its earnings momentum and record satisfactory performance in 2014.”

At 12.30 pm noon break today, Public Bank’s share price was flat at RM19.04 on trades of some 1.14 million shares.