KUALA LUMPUR (Nov 24): Malaysia Building Society Bhd’s (MBSB) net profit for the third quarter ended Sept 30, 2016 (3QFY16) fell 8.83% to RM57.93 million, from RM63.53 million in the same period last year.
 
In a filing today, the group said the decrease was mainly due to higher allowances for impairment losses on loans, advances and financing, following continuation of the impairment programme initiated in 4QFY14.
 
Revenue increased 8.10% to RM830.25 million, from RM768.03 million in 3QFY15, mainly driven by a higher contribution from corporate financing income and higher income from investments in liquefiable assets. 
 
The group’s total assets reached RM44.53 billion as at Sept 30, an expansion of 8.37% or RM3.44 billion, from RM41.09 billion as at Dec 31, 2015. The rise is mainly due to increase in liquefiable assets and growth in net financing and loans, said MBSB. 
 
Growth in gross financing and loans showed a positive trend of 1.64% at RM35.37 billion in 3Q, as compared with RM34.80 billion in the quarter before (2QFY16). Net impaired financing ratio stood at 2.91% in 3Q, down 0.38% as compared with 3.29% in the previous quarter.
 
“While our credit underwriting ensures qualified customers are able to secure financing, we do pay greater attention as well on early detection of distressed accounts, to prevent any deterioration of existing assets. It is key that customers get assistance at an early stage,” MBSB president and chief executive officer Datuk Ahmad Zaini Othman said in a statement.
 
The group registered a strong deposit level with an increase of 10.05% or RM2.87 billion to RM31.46 billion in 3QFY16, compared with RM28.59 billion recorded in December 2015, despite a very challenging environment, as banks aggressively competed to secure deposits from both retail and corporate segments.
 
Ahmad Zaini said MBSB will remain cautious in evaluating its business initiatives, in view of increasing market uncertainties.
 
“Due to these reasons, we have in the past year, secured financing of the affordable housing projects under the Perumahan Penjawat Awam 1Malaysia (PPA1M) and Perumahan Rakyat 1Malaysia (PR1MA). 
 
“We believe there is a lot of potential [within] this sector, as the property players have begun shifting their focus to this segment,” he added.
 
MBSB share price was down 0.54% at 92 sen at the midday break today, with 1.02 million shares traded, valuing the company at RM5.34 billion. — theedgemarkets.com

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