BIMB Holdings Berhad (BHB”), the country’s only Islamic financial holding company, reported a PBZT for the six months ended 30 June 2017 of RM461.4 million, representing a growth of 5.3% or RM23.2 million compared with the corresponding period in 2016 of RM438.2 million. BHB registered an annualised pre-tax Return on Equity (ROE) of 20.0% and after-tax ROE of 14.2%.
The net profit attributable to shareholders grew by 2.8% or RM7.8 million to RM286.8 million during the same period. Consequently, net asset per share also improved to RM2.69 as at 30 June 2017 compared with RM2.44 as at 31 December 2016.
BHB has embarked on the journey to sustainability based on five pillars, which are, responsible finance, inclusive growth, talent development, Islamic finance & knowledge and ethical practice & reporting, which have been reported in its 2016 Sustainability Report.
Committed to Bank Negara Malaysia’s Value Based Intermediary (VBI) initiative to create value for all stakeholders, BHB’s Chief Executive Officer Khairul Kamarudin said, “Islamic finance, with all its ingrained principles, remains relevant in a world that is increasingly focused on societal and environmental wellbeing which operates within systems of clear governance. Islamic finance is well-positioned to lead inclusive growth that leverages on ecosystem of responsible finance.” BHB’s key operating unit, Bank Islam, intends to continue positioning itself as a VBI that reflects the true essence of Islamic finance, with greater emphasis on environment, social and governance (ESG).
Bank Islam Group (Bank Islam) reported a PBZT of RM367.8 million for the six months ended 30 June 2017, representing an increase of 2.3% or RM8.1 million compared with the corresponding period in 2016.
The Bank continued to maintain its financing growth with net financing assets recording a Y-o-Y growth of 11.5% or RM4.2 billion to reach RM40.5 billion as at 30 June 2017. For the six months ended 30 June 2017, net financing growth, on an annualised basis was 6.7%. As at end of June 2017, customer deposits and investment accounts stood at RM48.1 billion with a Y-o-Y increase of RM5.7 billion or 13.4%. The Current Account Savings Account (“CASA”) and transactional investment accounts ratio as at end June 2017 stood at 31.8%.
With continued robust credit management and governance process, the Bank was able to maintain its strong asset quality. The Bank’s gross impaired financing ratio stood at 1.0% as at end June 2017.
The Bank’s capital position also remained healthy to support the continuous business growth with the Total Capital ratio of 16.0% as at end June 2017. The Bank registered an annualised pre-tax ROE of 15.8% and after-tax ROE of 11.4%.
Bank Islam will continue to defend its asset growth with focus on SME and supply chain, maintain asset quality and deposit drive while continuously embrace digitalisation. Bank Islam through a strategic collaboration with US-based Cognizant will lay the foundation of digital banking platform across its entire network.
The collaboration is to jointly build a digitalised banking space to develop Fintech solutions, such as blockchain technology, omni channel solutions and virtual banking to enhance customers’ experience. It will also provide an opportunity to develop innovative products and services that can generate new revenue stream for the Bank. In addition, in line with Basel III rules, the Bank will continue to manage liquidity and deploy capital efficiently in its operations.
The banking industry is anticipated to remain resilient despite the challenging operating environment with moderate financing growth. While competition for deposits and margin compression continue, sufficient liquidity in the banking system is projected to support financing activities.
Banks are also well positioned to maintain Basel III liquidity coverage ratio above the regulatory requirement to meet unexpected cash outflows or adverse liquidity shocks. Banks’ capitalisation is also likely to be sufficient to withstand assets quality distress.