KUCHING: CIMB Group Holdings Bhd (CIMB) posted lower earnings and turnover for the second quarter of 2014 (2Q14) with net profit declining 9.9 per cent year-on-year (y-o-y) to RM949.94 million.
In a filing to Bursa Malaysia yesterday, CIMB said its revenue for 2Q14 dipped slightly by 1.08 per cent y-o-y to RM3.4 billion from RM3.44 billion in 2Q13.
For the first half of 2014 (1H14), the group’s earnings also dropped 17.4 per cent y-o-y to RM2.02 billion from RM2.44 billion in 1H13.
The banking group added that its turnover for 1H14 fell six per cent y-o-y to RM6.95 billion from RM7.39 billion for 1H13.
CIMB chief executive Datuk Seri Nazir Razak in a statement said itt was a difficult first half, mainly due to the tough conditions in Indonesia and the sharply weaker rupiah, which combined to decrease CIMB Niaga’s profit before tax (PBT) contributions by 19.8 per cent.
“Low financial market volumes and volatility across the region led to weaker investment banking and treasury businesses.
“Nevertheless, excluding Indonesia and last year’s exceptional gain, our PBT was up 5.9 per cent y-o-y due to the strong performances of our Malaysian consumer bank, CIMB Bank Singapore and CIMB Thai,” he said.
Additionally, CIMB’s regional consumer bank’s PBT expanded by 1.4 per cent y-o-y in 1H14 to RM1.19 billion, making up 44 per cent of the group’s PBT with Thailand and Singapore turned profitable.
The Malaysian operations contributed 79 per cent of total consumer banking operations currently.
Nonetheless, CIMB Group said its regional wholesale banking’s PBT declined by 11.3 per cent y-o-y to RM1.228 billion due to slower equity and treasury markets.
On the bright side, the financial institution’s investments gained 26.2 per cent y-o-y.
CIMB Group noted that the overall contribution of the group’s core corporate and consumer banking business has increased from 68 per cent to 70 per cent of total PBT.
In spite of that, its non-Malaysian PBT contribution to the group was lower at 35 per cent in 1H14 from 39 per cent in 1H13.
The lower contribution was mainly caused by the 20.1 per cent y-o-y decline in Indonesia’s PBT to RM741 million from the lower CIMB Niaga earnings and the rupiah’s depreciation.
On another note, Thailand’s PBT contribution to the group grew 5.2 per cent y-o-y to RM125 million as the strong growth for CIMB Thai was offset by much weaker performance at CIMB Securities (Thailand).
Total PBT contribution from Singapore rose 13.2 per cent to RM160 million as CIMB Bank Singapore’s PBT grew by 58.2 per cent y-o-y.
The banking group said its net interest margins (NIM) were unchanged at 2.88 per cent compared with the same corresponding period last year.
As at June 30, CIMB Group revealed that its total capital ratio stood at 14.7 per cent while its common equity tier 1 (CET 1) capital ratio stood at 9.5 per cent.