AMMB Holdings Bhd yesterday announced net profit of RM860.8mil for the financial year ended March 31, 2009, up 29% from RM668.5mil the year before on lower provisions and minority interest payouts.
It is confident that its strategy for viable growth and rebalancing portfolio will strengthen its resilience to the global economic crisis.
“Retail, business banking and assurance segments were the main contributors to profit growth, while the investment banking and market trading results were impacted by difficult market conditions,” Group managing director Cheah Tek Kuang told reporters at a results briefing yesterday.
The group’s asset quality showed improvement and it had a lower non-performing loan (NPL) ratio of 2.6%.
For the year, AMMB Holdings posted earnings per share of 31.61 sen versus 28.24 sen for its 2008 financial year.
Cheah says NPLs may increase slightly to 4% for its current financial year due to difficult market conditions but bad loans would drop to 3% by the banking group’s 2012 financial year.
However, Cheah noted that the bank was well capitalised to face future challenges with Tier 1 capital adequacy ratio of 9.7% and total risk weighted capital adequacy ratio of 15.2%.
Net lending growth was expected to increase by 4% for its current financial year. Net loans lending was up by 8.3% to RM56.9bil in last year from the group’s 2008 financial year.
Meanwhile, deputy group managing director and chief financial officer Ashok Ramamurthy says the group’s capital expenditure was expected to increase by 30% to 50% or possibly higher this year as it would invest to position itself for an upturn in economic conditions the following year.
It expected the Second Stimulus Package (of RM60 billion announced by the Federal Government on March 10) to shield the economy from the worst impacts of the global downturn.
“We have spend about RM100mil (last financial year) to increase the number of branches and automated teller machines (ATMs) in high traffic volume locations as part of our key strategic initiatives,” he said.
The group had opened seven branches and set up 227 ATMs in various locations last financial year.
The group intends to increase its branches to more than 200 by 2011 from 187 currently.
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