KUALA LUMPUR AMMB Holdings Bhd has posted a 15.7 per cent growth in net profit to RM811 million for the first half of the year ending March 31 2012.
Growth was supported by higher non-interest income and lower allowances which was in line with the group's expectations, said group managing director Cheah Tek Kuang.
Its return on equity was up 1 per cent to 15.4 per cent compared to the first half of the previous year.
Total income grew 9.6 per cent to RM2.17 billion, driven by non-interest income growth of 31.7 per cent, he said at a media briefing here yesterday.
The group expects a challenging time ahead for the local banking sector due to persistent global headwinds but sees opportunities from the Economic Transformation Programme and Budget 2012 incentives.
"We estimate the economy to grow between 4 per cent and 5 per cent over 2011 and 2012," Cheah said, adding that the group is confident it can grow its profit by between 10 per cent and 12 per cent for the current financial year, from RM1.34 billion recorded in the previous financial year.
He said the group has lowered its expectations for the second half as it will not be "as strong as the last few years".
Cheah said for the next six to 12 months, the local banking sector is set to be vigilant against potential risks, with new macro-prudential measures being introduced by regulators on consumer loan products to curb financial imprudence risk in the household sector.
"Moderating loans demand and competition for deposits will continue to impact margins, while a tougher economic environment will likely put pressure on improving quality trends," said Cheah.
Deputy group managing director and chief financial officer Ashok Ramamurthy said the group will stay focused on growing non-interest income, current and saving accounts deposits and loans growth by targeting profitable and viable segments.
Reviewing the first-half year results, Ashok said the retail banking's net profit was down by 4.9 per cent due to margin pressure, while business banking division dropped 25.2 per cent. This was partly due to a prudent provisioning on a previously restructured loan during the global financial crisis.
Corporate and institutional banking did better with good income growth. Profit contribution from the investment banking division was also stronger by 35.9 per cent due to strong capital and equity market activities.
The board has proposed an interim single-tier dividend of 6.6 sen per share, 10 per cent higher then with the first-half of financial year 2011.
Growth was supported by higher non-interest income and lower allowances which was in line with the group's expectations, said group managing director Cheah Tek Kuang.
Its return on equity was up 1 per cent to 15.4 per cent compared to the first half of the previous year.
Total income grew 9.6 per cent to RM2.17 billion, driven by non-interest income growth of 31.7 per cent, he said at a media briefing here yesterday.
The group expects a challenging time ahead for the local banking sector due to persistent global headwinds but sees opportunities from the Economic Transformation Programme and Budget 2012 incentives.
"We estimate the economy to grow between 4 per cent and 5 per cent over 2011 and 2012," Cheah said, adding that the group is confident it can grow its profit by between 10 per cent and 12 per cent for the current financial year, from RM1.34 billion recorded in the previous financial year.
He said the group has lowered its expectations for the second half as it will not be "as strong as the last few years".
Cheah said for the next six to 12 months, the local banking sector is set to be vigilant against potential risks, with new macro-prudential measures being introduced by regulators on consumer loan products to curb financial imprudence risk in the household sector.
"Moderating loans demand and competition for deposits will continue to impact margins, while a tougher economic environment will likely put pressure on improving quality trends," said Cheah.
Deputy group managing director and chief financial officer Ashok Ramamurthy said the group will stay focused on growing non-interest income, current and saving accounts deposits and loans growth by targeting profitable and viable segments.
Reviewing the first-half year results, Ashok said the retail banking's net profit was down by 4.9 per cent due to margin pressure, while business banking division dropped 25.2 per cent. This was partly due to a prudent provisioning on a previously restructured loan during the global financial crisis.
Corporate and institutional banking did better with good income growth. Profit contribution from the investment banking division was also stronger by 35.9 per cent due to strong capital and equity market activities.
The board has proposed an interim single-tier dividend of 6.6 sen per share, 10 per cent higher then with the first-half of financial year 2011.
