BIMB’s 3Q profit up 8.3%, declares 15.5 sen dividend

By FARA AISYAH / Graphic By TMR

BIMB Holdings Bhd’s noted a stronger performance from its banking and insurance (takaful) businesses as its net profit for the third quarter ended Sept 30, 2018 (3Q18), improved by 8.28% year-onyear (YoY) to RM198.62 million.

The higher contributions from its two main operating subsidiaries, Bank Islam Malaysia Bhd and Syarikat Takaful Malaysia Keluarga Bhd (Takaful Malaysia) helped the group’s revenue increased by 19.78% YoY to RM1.09 billion for the quarter.

BIMB declared an interim single-tier dividend of 15.5 sen in respect of the financial year ending Dec 31, 2018.

In an exchange filing yesterday, BIMB revealed that Bank Islam’s profit before zakat and taxation (PBZT) for the quarter increased marginally to RM225 million from RM223.5 million a year ago, mainly due to higher total income.

The bank’s total income was higher by RM125.2 million due to higher fund-based income of RM100.9 million, which was mainly attributed to the increase in base rate and base financing rate by 25 basis points (bps) effective February 2018, in response to the 25bps increase in Overnight Policy Rate on Jan 25, 2018.

The increase was also attributed to the 10.4% YoY growth in net financing assets to RM44.3 billion from RM40.1 billion as at end-September 2017.

The higher total income was also supported by higher nonfund- based income of RM24.3 million for the July to September 2018 period compared to 3Q17.

Takaful Malaysia’s PBZT for the quarter increased by 33% YoY to RM87.8 million due to the increase in its net wakalah fee income.

The subsidiary generated an operating revenue of RM649 million compared to RM476.2 million in 3Q17, mainly attributable to higher sales generated by the family and general takaful businesses.

For the three months, the fami ly takaful business recorded a gross earned contribution of RM436.7 million compared to RM303 million in 3Q17, mainly attributable to higher sales from creditrelated products.

The general takaful business generated gross earned contribution of RM177.1 million during the quarter, an increase by 26.2% YoY, mainly from the fire and motor classes.

BIMB said Bank Islam will focus on optimising its risks and returns, resources and productivity, as well as its franchise value which is underpinned by a disciplined balance sheet management.

“This is to sustain netincome margin, preserve asset quality and minimise the financial impact arising from the implementation of the Malaysian Financial Reporting Standards 9 and the upcoming Net Stable Funding Ratio requirements.

“With digital transformation being a new thrust to enriching customer experience and services, Bank Islam has embarked on its digital journey in enhancing its reach and spurring innovation,” it noted.

Takaful Malaysia will remain focused on sustaining its position as the market leader in the family takaful business, while expanding its market share in the general takaful business to establish a strong foothold in the industry.

“Takaful Malaysia will continue to enhance its digital capability to increase its product and service accessibility to the consumers by intensifying its online marketing initiatives.

“It will also embark on multiple digital initiatives to further develop ‘customer centric’ value propositions to remain competitive in the industry,” it added.