KUALA LUMPUR: Public Bank Bhd’s net profit eased to RM1.33 billion in the second quarter ended June 30, 2019, against RM1.40 billion posted a year earlier, due to negative
effects from the 0.25 percent overnight policy rate (OPR) reduction in May 2019. Revenue for the quarter, however, rose to RM5.60 billion from RM5.44 billion year-on-year.
For the first half of 2019, Public Bank recorded a lower net profit of RM2.74 billion against RM2.80 billion year-on-year, while revenue increased to RM11.17 billion from RM10.79 billion previously. “The economic and banking environment was increasingly challenging. In addition to this, arising from the reduction of OPR in May 2019, domestic banks were faced with a decline in net interest
margins, which affected the profit for the half-year ended June 30, 2019,” said chairman emeritus Tan Sri Dr Teh Hong Piow in a statement
yesterday.
However, he said Public Bank was able to sustain stable profitability underpinned by its healthy loans and deposits growth, stable asset quality and prudent cost management. Public Bank continued to sustain a stable gross impaired loans ratio of 0.5 percent and efficient costto-income ratio of 34.2 percent, leading to a continued resilient net return on equity of 13.6 percent for the first half of 2019. In the first half of 2019, the Public Bank group’s total loans grew favourably by an annualised rate of 4.0 percent to RM323.7 billion.
Domestic loans, which covered more than 90 percent of the group’s loan portfolio, grew by an annualised rate of 4.3 percent, which was higher than the banking system’s annualised loan growth of 2.7 percent. On the funding side, the Public Bank Group achieved a healthy deposit growth, registering an annualised growth rate of 5.9 percent to RM349.1 billion with domestic deposits grew 5.7 percent in the first half of 2019.
As at end of June 2019, the group’s funding position remained stable with a healthy gross loan to fund and equity ratio of 78.9 percent and continued to achieve a low
gross impaired loan ratio of 0.5 percent. For the first six months of 2019, Public Bank’s common equity Tier 1 capital ratio, Tier 1 capital ratio and total capital ratio were at 13.2
percent, 13.6 percent and 16.0 percent, respectively. – Bernama
