RHBCap impresses with 12.7pc profit jump

The fifth largest fully integrated financial services group in Malaysia, RHB Capital Bhd reported a pre-tax profit of RM1.039 billion for the first half of this year, up 12.7 per cent from the RM922.2 million recorded a year ago. Its operating profit before allowances also grew to RM1.232 billion compared to RM1.122 billion in the corresponding period of last year.

The earnings per share increased to 35.9 sen against 32.0 sen previously and the net interest income increased by 12.6 per cent to RM1,383.5 million on the back of strong loans growth of 9.1 per cent.

"Other operating income grew by 13.7 per cent from previous year to RM582.8 million, boosted largely by higher service charges and fees, brokerage income, foreign exchange gains and insurance underwriting surplus, partially offset by a lower investment banking and treasury income," RHB said in a statement today.

The banking group has also proposed an interim dividend of 8.0 sen, less 25 per cent tax, amounting to RM131.5 million.

Meanwhile, income from Islamic banking business increased by 8.8 per cent to RM174.1 million. "This was mainly due to higher net profit income on the back of a 29.4 per cent financing growth for the first six months of the year to reach RM11.7 billion," Chairman of RHB Capital Datuk Mohamed Khadar Merican said. "Asset quality of the group continued to improve, reflecting our disciplined approach in risk management and collection processes.

"Allowance for loan impairment increased by 15.3 per cent to RM202.7 million due mainly to higher collective allowances of 1.5 per cent set aside for the loan volume growth," he said.

Gross loans grew by RM7.6 billion or 9.1 per cent to reach RM91.3 billion as at June 30, 2011.

The loans growth was broad-based, comprising mainly public sector lending, purchase of securities, purchase of transport vehicles and purchase of residential property. Customers deposits increased by nine per cent or RM8.5 billion to reach RM102.9 billion during the period reviewed.

As for the performance of its subsidiaries, RHB Bank Bhd recorded a pre-tax profit of RM931.3 million, up 6.2 per cent from a year ago.

The balance sheet of the bank also remained strong with total assets at RM114.8 billion and shareholders equity at RM8.9 billion as at June 30, 2011.

Chairman of RHB Bank Tan Sri Azlan Zainol said the bank aimed to maintain its growth momentum for the second half of the year.

RHB Islamic Bank Bhd achieved a pre-tax profit of RM68.5 million for the six-month period compared to RM32.6 million previously.

RHB Investment Bank Bhd on the other hand, recorded a pre-tax profit of RM59.6 million, 49.8 per cent higher compared with RM39.8 million recorded a year ago.--Bernama