KUALA LUMPUR (Feb 26): Hong Leong Financial Group Bhd's (HLFG) net profit for the second quarter ended Dec 31, 2020 (2QFY21) rose 4.9% to RM527.58 million, from RM502.96 million a year ago, on higher contributions from its operating businesses.

In a bourse filing, HLFG said quarterly revenue grew 19.07% to RM1.62 billion from RM1.36 billion previously.

The group declared an interim dividend of 10.8 sen per share to be paid on March 30.

HLFG said its commercial banking division, Hong Leong Bank Bhd, saw its profit before tax fall 4.9% to RM815.3 million from RM857 million in the previous corresponding quarter.

The decrease was mainly due to higher allowance for impairment losses on loans, advances and financing of RM221.4 million. This was, however, mitigated by a higher revenue of RM162.5 million and lower operating expenses of RM15.3 million, the group said.

As for its insurance division, HLA Holdings Sdn Bhd, HLFG said it recorded a 96.4% jump in quarterly profit before tax to RM127.1 million from RM64.7 million.

"The increase was mainly due to higher life fund surplus of RM43.9 million and higher revenue of RM24.4 million of which RM23.9 million was due to unrealised gain on revaluation of equities," said HLFG.

The group's investment banking division, Hong Leong Capital Bhd, saw its quarterly profit before tax soar 132.2% to RM53.4 million, from RM23 million a year earlier, to higher contributions from investment banking and stockbroking divisions.

HLFG said its cumulative half-year net profit rose 12.2% to RM1.11 billion, from RM993.16 million in the previous corresponding period, as revenue increased 16.08% to RM3.12 billion from RM2.69 billion.

HLFG chief executive officer Tan Kong Khoon said the group's overall results remained resilient in the midst of an economy being impacted by Covid-19 and tight containment measures.

"In such times, we continue to enhance our business continuity measures and prudently manage the key business risks. We expect the strength of our liquidity, capital and credit discipline to serve us well as we maintain our strong focus on risk management.

"In respect to business, we continue to further strengthen our digital strategy in building long-term sustainable value for our shareholders," he said.

Shares of HLFG were 34 sen or 2.1% higher at RM16.54 in afternoon trading, giving the group a market capitalisation of RM18.98 billion.