Malaysia: Maybank Posts Record Profit as Islamic Banking Income, Fees Grow

Malayan Banking Bhd. (MAY), Malaysia’s biggest lender, said third-quarter profit rose 16 percent, joining Public Bank Bhd. in posting record earnings as economic growth spurred credit demand.

Net income climbed to 1.75 billion ringgit ($545 million), or 20.05 sen per share, in the three months ended Sept. 30 from 1.5 billion ringgit, or 19.14 sen per share, a year earlier, the lender said in a stock exchange filing today. Fee income and Islamic banking boosted profit.

Maybank has been Malaysia’s top arranger of syndicated loans and number one underwriter for equity and rights offerings this year, according to data compiled by Bloomberg. It has helped manage some of the country’s biggest initial public offerings of the year, including share sales by UMW Oil & Gas Corp. and Westports Holdings Bhd.

“There continue to remain windows of opportunity in the different markets we serve,” Chief Executive Officer Abdul Farid Alias said in a separate e-mailed statement today. “Maybank’s three home markets consisting of Malaysia, Singapore and Indonesia, which contribute more than 90 percent of the group’s income and profit, are expected to record positive revenue growth.”

The lender benefitted from 5 percent growth in Southeast Asia’s third-largest economy last quarter, which spurred demand for credit.

Non-interest income rose 19 percent to 1.54 billion ringgit in the third quarter last year, Maybank said. Income from Islamic banking increased 29 percent to 734.9 million ringgit.

Interest Income

Shares of Maybank advanced 0.8 percent to 9.64 ringgit as of 3:26 p.m. in Kuala Lumpur after earnings were announced during the midday break. The stock has climbed 4.8 percent this year, trailing a 6.2 percent gain in the benchmark FTSE Bursa Malaysia KLCI Index.

Net interest income, or revenue from borrowers after deducting interest paid to depositors, gained 1.1 percent to 2.38 billion ringgit in the third quarter, Maybank said. Allowances for losses on loans more than tripled to 280.3 million ringgit, it said.

(Bloomberg / 21 Nov 2013)

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Alfalah Consulting - Kuala Lumpur: www.alfalahconsulting.com
Islamic Investment Malaysia: www.islamic-invest-malaysia.com