KUALA LUMPUR (Nov 29): Malaysia Building Society Bhd (MBSB) posted a net loss of RM104.6 million for the third quarter ended Sept 30, 2021 (3QFY21), compared with a net profit of RM258.24 million a year earlier, due to a modification loss and higher impairment allowance.

MBSB said it booked a modification loss of RM146.97 million, compared with modification gain of RM7.5 million in 3QFY20 and up from RM13.2 million in 2QFY21, as its main subsidiary MBSB Bank Bhd continued granting moratorium and other repayment assistance to customers under the government’s PEMULIH package.

Net allowance on impairment on loans, financing and advances came in at RM249 million, up from RM52.07 million in 3QFY20, the group said.

“Covid-19 has adversely affected many industries and individuals and many have not been able to operate within their optimum capacity,” MBSB acting CEO Datuk Nor Azam M Taib said in a statement. “Because of that, we provided an extended moratorium to the customers to provide them with some financial breather.”

MBSB's quarterly revenue fell 11.04% to RM681.05 million from RM765.57 million a year ago.

Its cost-to-income ratio jumped to 27.38%, from 25% in 3QFY20 and 24.01% in 2QFY21. Return on Equity declined to 5.45%, from 10.41% in 2QFY21, mainly due to the loss recorded in the latest quarter.

The group's total assets rose 1.34% to RM50.6 billion from RM49.92 billion in 3QFY20, but fell 0.48% on-quarter from RM50.83 billion in 2QFY21 — the latter mainly due to a decrease in interbank placements.

Despite the loss-making quarter, MBSB's cumulative net profit for the nine-month period ended Sept 30, 2021 more than doubled to RM362.25 million from RM172.48 million, thanks to a strong 2QFY21 that was supported by impairment write-backs.

The stronger bottom line performance came despite the nine-month revenue falling 15.3% to RM2.03 billion, from RM2.39 billion previously.

“We began receiving applications for Financial Management and Resilience Programme (URUS) since Nov 15 and we strongly encourage those who are seeking financial relief to contact us or apply for URUS on our website,” he said.

He added that the bank is working to better strengthen its asset quality where there is close monitoring of its net impaired financing ratio and ample provisions have also been set aside to buffer against potential losses.

Shares of MBSB slid 2.42% or 1.5 sen to close at 60.5 sen, giving the group a market capitalisation of RM4.34 billion.