KUALA LUMPUR (Nov 26): Alliance Bank Malaysia Bhd achieved a 66% hike in net profit for the second quarter ended Sept 30, 2021 (2QFY22) to RM172.74 million against RM103.94 million in the same quarter last year due mainly to higher interest income and lower credit cost.

As such, earnings per share expanded to 11.16 sen from 6.71 sen the year before, according to the banking group's quarterly results' filing with the Bursa Malaysia.

Its quarterly revenue, however, declined by 4.52% to RM452.98 million from RM474.45 million a year ago.

The bank declared a first interim single-tier dividend of 8.3 sen per share — to be paid on Dec 30, 2021 — representing a total dividend payout ratio of 40%.

"Net interest income (NIM) was higher by RM19.2 million or 5.7% mainly due to lower funding cost. NIM grew by 24 bps (basis points) to 2.47%.

"Other operating income decreased by RM40.7 million or 30.1% due to lower treasury and investment income and wealth management income.

"Operating expenses were higher by RM5 million or 2.6% mainly from personnel costs," said Alliance Bank, whose shares are trading at the price-to-book ratio of 0.66 times.

On a quarter-on-quarter basis, its net profit increased 18.3% from RM146.01 million in 1QFY22 despite a 4.52% drop in revenue from RM482.95 million in the immediate preceding quarter.

For the cumulative first half ended Sept 30, 2021 (1HFY22), Alliance Bank's net profit jumped 53% to RM315.75 million from RM208.26 million a year ago. Its cumulative revenue increased by 4.45% to RM935.94 million versus RM896.05 million previously.

"Increased sign-ups of the bank's Alliance SavePlus Account contributed to the growth of CASA (current and savings account) deposits, which grew by RM2.8 billion or 14.1% year-on-year (y-o-y). This led to CASA ratio improving to 49.6%, which remains at the top end of the industry.

"The bank's capital positions remained strong as Common Equity Tier-1 ratio was at 17.1%, while Tier-1 Capital ratio was at 18%, and total capital ratio was at 22.3%. Liquidity coverage ratio was at 165.7%. The bank's loan-to-fund ratio stood at 86.5%," it noted in a separate statement.

According to Alliance Bank group chief executive officer Joel Kornreich, the banking group sets a target to acquire over 100,000 new customers annually.

"By the end of financial year 2026 (FY26), we aim to be among the top four banks in SME market share in Malaysia and be a personal banker of choice to business owners.

"We are now focused on helping our customers reposition to capture growth opportunities as the market recovers. In addition, we continue to extend assistance to customers who require help," he added.

As of Nov 10, 2021, the bank had extended over RM14.6 billion in payment relief assistance, and it will also continue to facilitate the various government assistance grants for businesses, including the Syarikat Jaminan Pembiayaaan Perniagaan (SJPP) programme.

In the consumer segment, Alliance Bank continues to expand its partnerships and digital channels to accelerate acquisition. It recently launched the Alliance Bank Shopee store, where customers can apply for personal loans, its loan consolidation service (Alliance ONE Account), or open a SavePlus account conveniently on the e-commerce channel.

Furthermore, Alliance Bank also aims to grow RM5 billion in new sustainable banking business, and reduce its greenhouse gases emission footprint over the next four years.

Shares of Alliance Bank were trading up three sen or 1.09% to RM2.78, giving the bank a market value of RM4.3 billion.