Hong Leong’s net profit jumps to RM689m in 4Q

by ANIS HAZIM / pic by MUHD AMIN NAHARUL

HONG Leong Bank Bhd’s (HLB) net profit increased to RM689.48 million for the fourth quarter ended June 30, 2021 (4Q21) from RM569.42 million last year on higher net income and higher share of profit from associated companies.

Its revenue for the quarter was also higher at RM1.33 billion against the previous RM1.2 billion last year.

The group declared a final single-tier dividend of 35.22 sen per share for the current quarter.

“This brings the total dividend to 50 sen per share for the financial year of 2021 (FY2021) with a dividend payout ratio of 36%,” HLB said in a statement accompanying its financial results.

Gross loans and financing saw a healthy growth of 6.8% y-o-y, driven by expansion in key segments and funding disbursed to support SMEs and corporate businesses as part of their cash flow needs during the past year.

Total income for FY2021 recorded a 14.4% y-o-y growth to RM5.47 bil, on the back of loan/financing expansion and prudent asset-liability management.

Gross loans, advances and financing maintained its growth momentum, 6.8% higher y-o-y to RM155.8 billion, as the Bank continued to provide support to its customers in their personal and business endeavors.

The Bank’s healthy loan growth is predominantly led by expansion in our key segments of mortgages, SME and commercial banking.

Domestic loans/financing growth continued ahead of industry growth rate at 6.1% y-o-y.

Residential mortgages are 5.3% higher y-o-y at RM77.2 billion, on the back of a healthy loan pipeline while transport vehicle loans/financing was stable at RM16.8 billion.

Domestic loans to business enterprises increased by 12.6% y-o-y to RM48.8 billion, whilst SMEs saw loan/financing portfolio up 14.9% y-o-y to RM26.0 billion.

Loans and financing from overseas operations grew 18.9% y-o-y, attributed to solid y-o-y growth of 30.5%, 17.8% and 15.6% in Vietnam, Singapore and Cambodia respectively.

HLB MD and CEO Domenic Fuda (picture) said the group’s financial year ended amid the reimplementation of the movement control order, reintroduced to combat the resurgence of Covid-19 positive cases and impacting the economic recovery momentum.

“Progress in the rate of vaccination remains key to the economic recovery in Malaysia and globally, as it is expected to help contain the rate and severity of infections, leading to the eventual opening of all economic sectors and social activities, followed by cross border activities in the future,” said Domenic.

Domenic said HLB is cautiously optimistic that progress in this regard is underway and hence the local and global economies should enter 2022 with better recovery traction.

HLB will continue to be disciplined in its investments and expenditure to ensure a cost structure that enables the group to invest in growth opportunities that will deliver sustainable outcomes to its stakeholders.

HLB’ share price rose 22 sen or 1.05% to RM19.20 in intraday trade yesterday, valuing the group at RM41.66 billion.