MBSB 2Q net profit down 64% on higher opex, net impairment allowance

• MBSB said it recorded a higher opex of RM136.5 million because of the increase in personnel expenses and establishment costs such as depreciation of the new headquarters, and higher software and hardware maintenance.

KUALA LUMPUR (Aug 25): Malaysia Building Society Bhd’s (MBSB) second quarter net profit slipped 64.7% to RM142.3 million, from RM403.4 million a year ago, due to higher operating expenses (opex) and net impairment allowance. 

Earnings per share for the quarter ended June 30, 2022 fell to 1.98 sen from 5.78 sen, the group’s bourse filing showed.

Quarterly revenue increased slightly to RM656.3 million, from RM664.9 million in the same quarter last year.

MBSB said it recorded a higher opex of RM136.5 million because of the increase in personnel expenses and establishment costs such as depreciation of the new headquarters, and higher software and hardware maintenance.

Meanwhile, the group incurred a net impairment allowance of RM45.3 million during the quarter, mainly due to a deterioration in the staging of financing customers at retail portfolios following the end of Covid-19-related moratoriums.

As of June 30, 2022, the group’s total loans, advances and financing grew 1.8% year-on-year to RM36.8 billion, contributed mainly by growth in property financing in the consumer segment and trade business in the corporate segment.

MBSB’s total deposits stood at RM33 billion, while CASA (current accounts and savings accounts) was recorded at RM1.6 billion, an increase of more than RM1 billion due to campaigns to attract depositors over the last one year.

Cumulative six-month net profit fell 57% to RM200.5 million from RM466.8 million, as revenue dropped to RM1.32 billion from RM1.35 billion.

In a separate statement, MBSB group chief executive officer Datuk Nor Azam M. Taib said the group anticipates positive consumer sentiment, as seen in the second quarter growth of 8.9%, to continue for the year, helping improve demand for retail and corporate banking services, including SME financing and wealth management products.

Going forward, he said the group is targeting to improve its presence in the financial sector, on the back of an improving financing environment as evidenced by robust growth in Malaysia’s economy during the second quarter.

MBSB’s share price closed one sen or 1.72% higher at 59 sen on Thursday (Aug 25), for a market capitalisation of RM4.23 billion.