RHB Capital profit up on higher income: STAR

PETALING JAYA: RHB Capital Bhd recorded a net profit of RM228.6mil for the first quarter ended March 31, 2009, up 3% from RM222.4mil in the previous corresponding period due to higher net interest income, impairment loss no longer required and improved Islamic banking business income.
In a filing to Bursa Malaysia, the group said the improved performance was largely offset by lower other operating income, higher loan-loss allowances and elevated other operating expenses.
In a statement, RHB Bank chairman Datuk Azlan Zainol said: “Keen competition is expected to continue among the various industry players coupled with lower interest rates and demand, hence we expect there would be further pressure on net-interest margins.”
He added that the group would remain focused on building its core businesses as well expand its market share during the more challenging period with improvement in its sales, service and support infrastructure.
“Barring any unforeseen circumstances, the group expects to achieve a satisfactory performance in 2009,” he added. During the first quarter of 2009, the statement said, the net interest income amounted to RM573.5mil, an increase of 8% or RM43.2mil compared with the previous corresponding period.
“The increase was largely due to lower interest expense as a result of reduced treasury money market operations and benefits due to lower overnight-policy rate,” the statement said.
Other operating income declined by 12% to RM213.1mil for the first quarter due to lower fee income and lower net gain on foreign exchange.
Meanwhile, loan-loss allowances was higher by 15% as result of further pre-emptive specific provision made during the period under review in the light of weaker economic condition.

(The Star, Wednesday May 20, 2009)