Maybank’s 3Q earnings ease on lower fee-based income

However, its strong liquidity and capital base will allow it to tap growth opportunities emerging with the reopening of the economy, chairman says 


MALAYAN Banking Bhd’s (Maybank) higher impairment losses and reduction in fee-based income culminated in its net profit for the third quarter ended Sept 30, 2021 (3Q21), falling 13.71% year-on-year (YoY) to RM1.68 billion. 

Revenue for the period fell to RM11.15 billion from RM13.76 billion in 3Q20, the country’s largest bank by assets stated in a filing to Bursa Malaysia yesterday. 

The 3Q21 earnings per share slipped to 14.41 sen and the bank did not declare any dividend. 

Maybank chairman Tan Sri Zamzamzairani Mohd Isa stated that despite the impact of movement restrictions on the group’s 3Q21 performance, its strong liquidity and capital base will allow it to tap growth opportunities emerging with the reopening of the economy. 

“We will position ourselves for renewed growth and to support our customers in making the most of these early days of economic recovery,” he wrote in a separate statement. 

Group president and CEO Datuk Abdul Farid Alias said Maybank will continue to provide tailored financial solutions to meet the current needs of customers that have shifted from preservation to growth, with the reopening of economies, while continuing to support customers who require targeted financial assistance. 

“This includes supporting them in embracing digitalisation in their operations, exploring alternative forms of financing solutions and looking at investment solutions that can help grow their wealth,” he added. For the cumulative nine months (9M21), Maybank’s net profit rose to RM6.04 billion from RM4.94 billion in 9M20 despite a lower revenue of RM34.7 billion in 9M21 versus RM38.79 billion in 9M20.

Maybank stated that its total group gross loans grew 4% YoY as at Sept 30, lifted mainly by increases of 11.3% and 2.2% in its Singapore and Malaysia operations, respectively, while the Indonesian operations saw a 9.9% decline. 

Current account and saving accounts (Casa) expanded 12.3%, improving the Casa ratio to 46% as at end September. The group’s total deposits expanded 2.8%. 

Over the nine months period to Sept 30, the group recorded a net interest margin (NIM) of 2.31%, which improved from 2.08% a year earlier due to lower deposit cost and strong Casa growth. 

On a quarter-on-quarter basis, NIM in the 3Q fell 11 basis points to 2.26% due to the impact from net modification loss arising from the moratorium granted to consumers, and small and medium enterprises borrowers as part of pandemic relief efforts. 

“The group will continue to prioritise low-cost funds and targeted growth opportunities within our home markets, while remaining proactive in our engagement with customers to address asset quality concerns,” it said. 

Maybank will also target fee-based income opportunities through its wealth management, global markets, investment banking, asset management and insurance segments. 

“Capitalising on our domestic franchise and leadership position in digital banking, we will focus on accelerating product roll-outs on our digital platform to increase market penetration and generate fee-based revenues. 

“Furthermore, the group will enhance productivity and efficiencies, while maintaining disciplined cost management to offset top-line pressures,” it noted.