AMMB's Q3 net profit rises 8.3pc on faster loan growth

The fifth largest bank made RM268.5 million in the quarter to December 31. For the nine-month period, it has chalked up a RM766.9 million net profit, a 12.6 per cent increase from last year, on faster loan growth.

This represents annualised earnings per share of 35.4 sen and post-tax return on equity of 11.9 per cent.

"The group is well placed to deliver a record full-year net profit and continues to build on the profitable growth momentum towards achievement of its medium-term aspirations," chief executive officer Cheah Tek Kuang said in a statement yesterday.

The bank aims to diversify income stream, manage costs better, grow deposits and boost risk disciplines.
In the nine months to December 31 2009, the higher profit was driven by better-than-expected net loans growth of 14.1 per cent as a result of the strong growth in syndication and bridging finance loans, Cheah said.

Customer deposits expanded 12.2 per cent over the same period.

Despite the faster loan growth, net non-performing loans fell 98 basis points to 1.8 per cent from a year ago, a result of its disciplined focus on "targeted" lending.

The revival in capital market activities also helped double profit at its investment banking division in the three quarters.

"As we look at 2010, we are encouraged by the increasing global optimism for revival of world economies," Cheah said.

"However, by virtue of its trade and export dependency, we expect the recovery process in Malaysia to be gradual," he added.

He said the bank is repositioning the balance sheet for rising interest rates, possibly after Bank Negara Malaysia's governor this month signaled that interest rates will not stay at the current low level for too long.

The bank is preparing for up to 75 basis-point increase in the benchmark Overnight Policy Rate between now and the financial year ending March 31 2011, Cheah said.