KUALA LUMPUR (Nov 19): CIMB Group Holdings Bhd declined as much as 2% following announcement that its third quarter net profit fell 16% from a year earlier.

 CIMB dropped as much as 13 sen to RM6.07 before reducing losses. At 12.30pm, the stock settled at RM6.09 with about 5 million shares traded. It was the seventh largest decliner on the bourse.

CIMB's net profit dropped to RM890.27 million in the third quarter ended September 30, 2014 from RM1.06 billion in the previous corresponding quarter. Revenue rose to RM3.53 billion from RM3.49 billion.

For the cumulative nine-month period, CIMB’s net profit declined to RM2.91 billion from RM3.5 billion a year earlier.

In a note, AllianceDBS Research Sdn Bhd said CIMB's "higher provisions largely at its Indonesian operations resulted in a weaker quarter-to-quarter earnings."

AllianceDBS said with the continued weakness in CIMB's Indonesian operations, it was unlikely that CIMB would meet its 14% return on equity (ROE) target.

AllianceDBS maintained its "hold" call for CIMB shares with an unchanged target price of RM6.90

"The TP figure is irrelevant at this juncture as valuations would largely depend on the (CIMB-RHB Capital-MBSB) merger," AllianceDBS said.