Hong Leong Islamic Bank Announces First Quarter FY2013 Results
Kuala Lumpur, 14 November 2012
Hong Leong Islamic Bank Berhad (the "Bank") today announced its results for the first quarter ended 30 September 2012.
- Net profit after tax for the first quarter ended 30 September 2012 ("Q1FY13") stood at RM65.2 million
[an increase of 26% over the previous financial year based on pro forma accounts with the assumption that the merger of HLISB and EONCAP Islamic Bank Berhad (EIBB) had occurred as at 1 July 2011 ("Pro Forma Basis")]. - Total Assets at RM20.0 billion as compared to the same quarter last year of RM22.1 billion on Pro Forma basis.
- Gross Financing and Advances grew to RM12.6 billion, or 8% growth year-on-year on a Pro Forma Basis.
- Customer Deposits at RM16.4 billion as compared to the same quarter last year of RM17.5 billion on Pro Forma basis with financing to deposit ratio improving from 67% to 77% year on year.
Summary of Financial Performance
Note: The accompanying table and commentary uses the Pro Forma Basis to better reflect a review of the Bank's performance on a like-to-like basis.
| (Figures in RM 'million unless otherwise stated) | Quarter 1 |
Quarter 1 |
Change % |
Quarter 1 |
Quarter 1 |
Change % |
|---|---|---|---|---|---|---|
| EARNINGS & EFFICIENCY | ||||||
| Total distributable income | 244.4 |
246.5 |
-1% |
244.4 |
134.3 |
82% |
| Income attributable to the depositors | (111.6) |
(133.7) |
-17% |
(111.6) |
(80.7) |
38% |
| Total net income | 132.8 |
112.8 |
18% |
132.8 |
53.5 |
148% |
| Operating expenses | (45.8) |
(43.5) |
5% |
(45.8) |
(20.0) |
129% |
| Profit before tax | 87.0 |
69.3 |
26% |
87.0 |
33.5 |
160% |
| Profit after tax | 65.2 |
51.9 |
26% |
65.2 |
25.1 |
160% |
| Cost-to-income ratio ("CIR") | 41% |
45% |
-4% |
41% |
48% |
-7% |
| PERFORMANCE RATIOS | ||||||
| Return on equity (ROE) | 22% |
14% |
8% |
22% |
11% |
11% |
| Return on assets (ROA) | 1.2% |
1.0% |
0.3% |
1.2% |
0.8% |
0.5% |
| FINANCING& DEPOSITS | ||||||
| Total assets | 20,020 |
22,071 |
-9% |
20,020 |
13,730 |
46% |
| Gross financing | 12,627 |
11,657 |
8% |
12,627 |
5,932 |
113% |
| Customer deposits | 16,425 |
17,504 |
-6% |
16,425 |
10,221 |
61% |
| Financing to deposits ratio | 77% |
67% |
10% |
77% |
58% |
19% |
ASSET QUALITY |
||||||
| Gross impaired financing ratio | 1.7% |
2.1% |
0.4% |
1.7% |
0.7% |
1.0% |
| Net impaired financing ratio | 0.2% |
0.8% |
-0.6% |
0.2% |
0.3% |
-0.1% |
| Financing loss coverage | 168.7% |
125.4% |
43.3% |
168.7% |
168.3% |
0.4% |
EQUITY & CAPITAL RATIOS |
||||||
| Shareholders' equity | 1,230 |
1,520 |
-19% |
1,230 |
912 |
35% |
| Tier-1 capital adequacy ratio | 9.90% |
12.85% |
-2.95% |
9.90% |
14.96% |
-5.06% |
| Risk-weighted capital adequacy ratio | 13.71% |
16.76% |
-3.05% |
13.71% |
15.54% |
-1.83% |
Net Profit
The Bank achieved a Profit After Tax of RM65.2 million for Q1FY13, a growth of 26% on a Pro Forma Basis. The growth was derived from the increased contribution from the financing and treasury activities coupled with an improvement in asset quality.
Return on Equity (ROE) and Return on Assets improved to 22% and 1.2% respectively, on the back of higher profitability during the current quarter.
Total Net Income
The Bank recorded a Total Net Income of RM132.8 million as at 30 September 2012, a growth of 18% on a Pro Forma Basis contributed by the enlarged client base and capacity of the merged bank. Cost to income ratio dropped to 41% from 45% last year reflecting the better cost efficiency achieved after the merger.
Financing Growth
The Bank posted total assets of RM20.0 billion in Q1FY13 as compared to the same quarter last year of RM22.1 billion on Pro Forma Basis, mainly due to the reduction in treasury assets from the rebalancing of the funding and liquidity needs of the merged entity.
Gross Financing expanded by 8% on a Pro Forma basis to RM12.6 billion, mainly contributed by the consumer banking segment, particularly Mortgage-i which recorded a growth of RM1.5 billion or 32% on a Pro Forma Basis.
Credit Quality & Impairments
The Bank maintained its asset quality with Gross Impaired Financing Ratio improving from 2.1% last year to 1.7% this year and the Net Impaired Financing Ratio from 0.8% last year to 0.2% this year.
Deposits, Liquidity & Capital
The Bank's customer deposit base stood at RM16.4 billion as at 30 September 2012, with the Financing to Deposit Ratio holding steady at 77%, improved from 67% last year. The ratio of Current and Savings Accounts (CASA) deposits to total deposits grew from 23% last year to 25% this year. The retail core deposits expanded to RM3.9billion with a growth of 23%, contributing 24% to the Bank's deposit base, which is higher than last year of 18%.
Risk Weighted Capital Adequacy Ratio (RWCR) remained strong at 13.7%, well above the minimum requirement of 8%.
Business Outlook
HLISB maintains a positive outlook for the Islamic Banking industry and is optimistic in continuing to build its capabilities and strengths to further grow its corporate and investment banking portfolios. In addition to that and towards ensuring sustainable long-term value, the Bank will also strive to further strengthen its non-financing income segments.
Media Contact
Group Corporate Affairs & Public Relations
Hong Leong Bank Berhad
DID: 03-20808888 ext 3281
Email: capr@hongleong.com.my
