KUALA LUMPUR: Public Bank Bhd's net profit for the fourth quarter ended Dec 31, 2022 (4QFY2022) grew 24.1% to RM1.71 billion or 8.83 sen per share, from RM1.38 billion or 7.11 sen per share in the same quarter last year, as revenue rose 24.79% to RM6.06 billion from RM4.86 billion.
It declared a third interim dividend of five sen per share, amounting to RM970.53 million, to be paid on March 22. This brings the bank's total dividend payout for FY2022 to RM3.3 billion, its Bursa Malaysia filing showed on Monday (Feb 27).
The bank's net profit attributable to equity shareholders reported a lower increase of RM332.8 million or 24.1% to RM1.71 billion in the quarter — compared to the 39.6% increase in pre-tax profit of RM714.8 million to RM2.52 billion — due to additional tax charge arising from the prosperity tax.
“Net interest income and income from Islamic banking business increased by RM573.9 million (23.2%), whereas loan impairment allowance decreased by RM192.3 million (68.1%). These were partially offset by higher other operating expenses (RM79.4 million or 8.3%),” said Public Bank.
“Higher net interest income and income from Islamic banking business were partly attributable to loan growth and the positive effect of OPR (overnight policy rate) hikes. The lower loan impairment allowance was mainly attributed to adequate pre-emptive allowance made in the prior years,” it said.
Meanwhile, other comprehensive loss (net) for the group for the quarter decreased by RM185.2 million to RM27.8 million, mainly due to gain on revaluation of financial investments. This was partially offset by higher loss on foreign currency translation in respect of foreign operations arising from the ringgit's strengthening against the US dollar and Hong Kong dollar, as well as loss on cash flow hedges.
For the full FY2022, Public Bank's net profit increased 8.13% to RM6.12 billion from RM5.66 billion in FY2021, as revenue rose 9.23% to RM21.43 billion from RM19.62 billion.
The group's Common Equity Tier I capital ratio, Tier I capital ratio and total capital ratio stood at a healthy level, with Common Equity Tier I capital ratio at 14.6%, Tier I capital ratio at 14.6% and total capital ratio at 17.6%, it said.
“Liquidity position also remained stable and healthy with liquidity coverage ratio standing at 127.7% as at Dec 31, 2022,” said the bank.
Looking ahead, the bank said the country's economic growth in 2023 is projected to remain on a positive trajectory, supported by resilient domestic demand, although global headwinds caused by elevated inflationary pressure, tighter monetary policy conditions, persistent supply disruption and geopolitical tensions are likely to continue to weigh on the economy.
“The persisting economic challenges will continue to have spillover effects on the banking sector. Consumer and business sentiments will continue to be affected by the high inflationary pressure and softening global growth. However, the outlook on the Malaysian economy remains positive, and this will continue to support a conducive environment for banking business growth,” said Public Bank managing director and chief executive officer Tan Sri Dr Tay Ah Lek.
“As the group continues to grow its retail and commercial banking business, it will remain focused on digital transformation, sustainability agenda as well as staff upskilling and reskilling, to ensure sustainable earnings growth and safeguard stakeholders' interests at all times,” he added.
At the time of writing on Monday, Public Bank shares were trading three sen or 0.73% higher at RM4.16, giving the group a market capitalisation of RM80.75 billion.
Source : The Edge Markets