KUALA LUMPUR (May 27): AMMB Holdings Bhd reported a 46% drop in fourth quarter net profit from a year earlier at RM280.2 million as net interest, Islamic banking and insurance income fell.
In a statement to Bursa Malaysia today, AMMB which is also known as AmBank, said the RM280.2 million net profit in the fourth quarter ended March 31, 2016 (4QFY16) fell from RM519.22 million. Revenue was lower at RM2.1 billion versus RM2.22 billion.
Full-year net profit declined to RM1.3 billion, from RM1.92 billion a year earlier. Revenue was lower at RM8.42 billion, compared with RM9.14 billion.
"Reduction in earnings for current financial year ended 31 March 2016 was mainly due to lower income. Income was lower due to decrease in net interest income by RM343.4 million, and decrease in income from Islamic banking business and insurance business by RM58.9 million and RM38.7 million respectively," AMMB said.
Despite lower 4QFY16 and full-year net profit, AMMB said it planned to pay a dividend of 10.5 sen a share for the quarter in review. The dividend brings full-year dividends to 15.5 sen a share.
Looking ahead, AMMB said it was mindful of potential slower growth in the Malaysian banking sector.
"The banking sector is poised to experience slower growth, as the economy expands at a more moderate pace and subdued business sentiment. Despite the potential headwinds in the economy, there are still some bright spots and opportunities, such as the SME sector which has consistently outpaced the GDP growth since 2005, and still has room for growth.
"The recalibrated Budget 2016 has also provided some impetus to the domestic consumption, as well as emphasis on affordable homes and implementation of infrastructure projects," AMMB said.
At Bursa Malaysia today, AMMB shares rose six sen or 1.4% at 12:30 p.m. to settle at RM4.25, for a market value of RM12.81 billion. The stock saw 922,600 shares traded.
Yesterday, AMMB shares fell 18 sen to RM4.19.