Revenue was also lower at RM13.76 billion from RM13.83 billion previously, it said in a filing with Bursa Malaysia today. — Picture by Yusof Mat Isa

KUALA LUMPUR, Nov 27 — Malayan Banking Bhd’s (Maybank) net profit for the third quarter ended September 30, 2020, came in at RM1.95 billion compared with RM2.0 billion in the same quarter last year.

South-east Asia’s fourth largest bank by assets said the lower net operating income was mainly due to the continued impact from the Covid-19 pandemic, although this was partly offset by reduced overhead expenses and a decline in impairments.

Revenue was also lower at RM13.76 billion from RM13.83 billion previously, it said in a filing with Bursa Malaysia today.

In a separate statement, Maybank said its net operating income for the quarter under review declined to RM6.08 billion from RM6.50 billion previously owing to an 8.7 per cent year-on-year (y-o-y) drop in total net fund based income to RM4.13 billion, as a result of a 27 basis points (bps) y-o-y net interest margin compression due to the cuts in the Overnight Policy Rate.

"In addition, the group saw a 1.3 per cent dip in total net fee-based income to RM1.95 billion, particularly from lower core fees following slower business activity due to the pandemic, as well as lower investment gains,” it said.

For the cumulative nine months ended September 30, 2020, Maybank saw its net profit narrowed to RM4.94 billion from RM5.75 billion in the same period a year ago, while revenue was at RM38.77 billion versus RM39.86 billion previously.

Maybank said its board of directors had declared an interim dividend of 13.5 sen per share for the nine-month period ended September 30, 2020, which will be made under the bank’s dividend reinvestment plan (DRP).

Chairman Tan Sri Zamzamzairani Mohd Isa said that given the improvement in the third-quarter results, Maybank had decided to continue with its practice to pay an interim dividend to shareholders, albeit at a lower rate compared to the past owing to the impact of the Covid-19 pandemic.

"While Maybank’s capital position remains robust, we have nevertheless ensured that we continue to take a prudent approach with a DRP in which the entire portion is electable.

"Our key priority has always been to balance shareholder interests with the need to maintain sufficient buffers in case of prolonged uncertainties, as well as to fund our growth plans for the future,” he said.

Meanwhile, group president and chief executive officer Datuk Abdul Farid Alias said Maybank’s focus moving forward would be to leverage its risk management capabilities, diversified operations and digital strengths to drive its business in the coming year.

"At the same time, we remain committed to supporting our stakeholders through this period so that they can remain sustainable in the long run,” he said.

According to the statement, Maybank’s loans at the group’s Malaysian operations grew 5.2 per cent y-o-y as at September 30, 2020; however, overall loans growth was offset by declines in key home markets of Singapore (-7.8 per cent) and Indonesia (-15.8 per cent) owing to the weaker operating environment, as well as part of the group’s strategy to realign its portfolio in view of the pandemic outbreak.

"This resulted in a marginal 0.6 per cent dip in group gross loans compared to a year earlier,” it said.

On deposits, Maybank said that in line with the strategy to maintain a robust liquidity base and expand the group’s low-cost funding structure, deposits grew 4.8 per cent y-o-y, boosted by a 10.2 per cent increase in Singapore, 3.3 per cent in Malaysia and 0.8 per cent in Indonesia.

"Consequently, the group’s current account and savings account (CASA) ratio expanded further to 42.1 per cent as at September 2020 from 34.6 per cent a year earlier,” it said.

While the blanket loan moratorium in Malaysia has ended on September 30, 2020, Maybank said the group remained supportive of those still impacted by the Covid-19 pandemic by offering various repayment assistance (RA) packages.

"More than 93,000 RA applications were received from both individual and small and medium-sized enterprise customers as at November 16, 2020, and all eligible applications have been approved.

"Of those approved, about 43 per cent were granted an additional three months repayment deferment until December 31, 2020, mainly due to unemployment, while the other applicants had requested a reduction in repayments owing to reduced income,” it added. — Bernama