KUALA LUMPUR: CIMB Group Holdings Bhd posted a higher net profit of RM1.77 billion for the second quarter ended June 30, 2023 from RM1.28 billion a year ago.
The bank's revenue grew 9.2 per cent to RM5.33 billion from RM4.88 billion previously.
CIMB registered an earnings per share of RM16.63 from RM12.30 a year ago.
For the cumulative period, the company's net profit increased 26.2 per cent to RM3.42 billion against RM2.71 billion from a year ago.
CIMB, in a statement, said the performance for the first half was credited to strong operating income growth, stringent cost controls and lower provisions as the bank had benefitted from the diversified Asean portfolio.
This is also supported by strong business growth in Indonesia and Singapore.
The bank's revenue for the six months went up 7.38 per cent to RM10.33 billion from RM9.62 billion in the same period last year.
CIMB has increased its dividend payout ratio to 55 per cent for 1H23 from 50 per cent in 1H22.
This was translated to a proposed all-cash first interim dividend of 17.50 sen per share this year, amounting to RM1.87 billion.
CIMB said its operating income for 1H23 went up 7.4 per cent year-on-year (YoY) to RM10.33 billion.
"Out of this, non-interest income (NOII) recorded a strong growth with a 32.0 per cent increase YoY to RM3.16 billion, contributed by stronger markets-related and other income.
"However, net interest income (NII) contracted marginally YoY to RM7.17 billion, due to net interest margin (NIM) compression caused by heightened cost of deposits but was partially offset by positive loan growth momentum," it said.
CIMB's total gross loans and deposit growth increased 8.3 per cent and 9.5 per cent respectively YoY across the bank's key markets and business segments.
Its cost-to-income ratio dropped 50bps YoY to a record low of 46.0 per cent.
CIMB said this was due to its operating expenses which rose 6.2 per cent due to an uptick from underlying operational cost.
Group chief executive officer Datuk Abdul Rahman Ahmad said the bank's performance was credited to the strong NOII and loan growth, apart from contained cost and provisions.
"It is encouraging to see our diversified Asean portfolio showing positive results, with growth driven from the reshaped Indonesia and Singapore operations cushioning the group from downside risks in weaker markets.
"We are particularly pleased with CIMB Niaga's transformation, which achieved a record high return on equity (ROE) of 15.4 per cent for 1H23."
He added that the achievement validated the group's Forward23+ strategic plan to reshape its portfolio as it leveraged the strengths of its core segments and markets.
"Our priority continues to be on executing this strategic plan, especially in strengthening our CASA franchise and deposits to help moderate the competitive deposit environment," he added
