Maybank Reports 21% Surge in Net Profit to $1.482 Billion in 9 Months

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Maybank, the fourth-largest bank in Southeast Asia by assets, has reported a profit after tax and minority interest (PATAMI) of MYR 6.96 billion ($1.482 billion) for the nine-month period ending September 30, 2023. This reflects a notable 21.0% increase compared to the same period in the previous year. The profit before tax (PBT) also rose by 14.4% year-on-year (Y-o-Y) to MYR 9.58 billion ($2.04 billion). The positive results were attributed to steady income growth and a significant improvement in net impairment provisions.

For the nine months, the net operating income increased by 3.6% Y-o-Y to MYR 20.38 billion ($4.34 billion). This growth was driven by a substantial increase of 37.8% in non-interest income (NOII) to MYR 5.95 billion ($1.268 billion) compared to the previous year. However, net fund-based income saw a 6.0% decrease as the net interest margin (NIM) compressed by 25 basis points due to higher funding costs resulting from interest rate hikes and ongoing deposit competition.

Overhead costs expanded to MYR 9.77 billion ($2.083 billion), up from MYR 8.83 billion ($1.882 billion) in the previous year. This increase was attributed to higher personnel costs, credit card-related fees due to increased billings, depreciation of ROU (right of use) assets, and IT-related costs. Consequently, the group’s pre-provisioning operating profit (PPOP) slightly decreased by 2.1% Y-o-Y to MYR 10.61 billion ($2.262 billion).

Net impairment provisions showed a significant reduction of 53.4% to MYR 1.21 billion ($258.0 million), influenced by a writeback in financial investments and others of MYR 152.5 million ($32.517 million) and lower net loan provisions of 27.6% to MYR 1.36 billion ($289.991 million). This contributed to a decrease in the net credit charge-off rate for loans to 31 basis points from 45 basis points in the previous year. The gross impaired loans ratio declined to 1.43% from 1.70% a year earlier, while the loan loss coverage strengthened to 127.1% in the nine months.

Maybank’s total assets grew from MYR 945 billion ($201.5 billion) as of December 2022 to MYR 1.0 trillion ($212.947 billion) as of September 2023, surpassing the MYR 1.0 trillion mark for the first time.

In the third quarter of 2023, PATAMI increased by 12.3% Y-o-Y to MYR 2.36 billion ($503.21 million), while PBT for the quarter was up 1.8% to MYR 3.16 billion ($673.8 million). Net operating income for the quarter decreased by 5.2% Y-o-Y to MYR 6.75 billion ($1.439 billion), mainly due to a decrease in net fund-based income.

Compared to the preceding quarter (2Q FY23), net profit for the third quarter increased by 0.8%, and net impairment provisions declined by 40.4%. However, PBT for the quarter was 6.3% lower compared to 2Q FY23.

Maybank’s group president and CEO, Khairussaleh Ramli, highlighted the global challenges but emphasized Maybank’s commitment to pursuing growth opportunities guided by its corporate strategy. The bank aims to maintain strong liquidity, improve asset quality, and preserve sound capital levels while bringing about positive impacts on the communities it serves.

The bank’s total group gross loans grew by 5.1% Y-o-Y, driven by increases in Malaysia, Singapore, and other markets. Maybank’s gross deposits expanded by 3.5%, with fixed deposits growing by 20.3%, offsetting declines in other deposits and current account and savings account (CASA).

Maybank maintained robust capital and liquidity positions, with its CET1 capital ratio at 15.41% and total capital ratio at 18.77%. The liquidity coverage ratio remained stable at 137.4%, well above the regulatory requirement of 100%.

Maybank’s progress in sustainable financing for the nine months ended September 2023, achieving close to MYR 53 billion ($11.301 billion), was noted. The bank continues to focus on sustainable financing and decarbonization solutions for its customers while aiming for a clear pathway to net-zero emissions.

In terms of sectoral performance, the group’s community financial services (GCFS) reported an 8.6% Y-o-Y increase in net operating income, driven by steady growth in both net fund-based and NOII. The wealth management segment showed an upward trajectory, with total financial assets rising by 10.2% to MYR 458 billion ($97.658 billion).

Maybank’s global banking (GGB) reported a 31.9% Y-o-Y increase in PBT for 9M FY23, despite a 13.1% decrease in net operating income. The Islamic banking business recorded a dip in PBT, while Etiqa Insurance and Takaful reported a robust increase in PBT to MYR 645.4 million ($137.617 million).

Maybank Indonesia and Maybank Singapore reported financial results for the nine months, reflecting growth in PBT for Maybank Indonesia and a decline for Maybank Singapore, impacted by lower income and higher overheads.

Maybank remains focused on executing its M25+ strategy, driving digitalization, operational efficiencies, and future revenue growth through 12 strategic programs under the M25+ strategy and targeted investments.

Despite challenges, Maybank expresses a commitment to being forward-looking, innovative, and customer-centric as it navigates the evolving operating landscape.