Hong Leong Bank’s 3Q net profit rises to RM1.04bil

KUALA LUMPUR: Hong Leong Bank Bhd’s (HLB) net profit for its third quarter ended March 31, 2024 (3Q24) increased to RM1.04bil from RM929.96mil in the same period last year.

Revenue was higher at RM1.44bil from RM1.4bil previously.

In a filing with Bursa Malaysia yesterday, HLB said net interest income grew to RM1.18bil for the quarter under review, underpinned by strong loans/financing expansion and effective funding cost management.

For the nine months (9M24), HLB’s net profit rose 7.1% to RM3.16bil from RM2.95bil in the previous corresponding period, contributed by solid loans/financing growth, disciplined cost management and robust contributions from its associates.

“Consequently, this translates into a commendable return on equity (ROE) of 12%,” the bank added. Revenue for 9M24 fell to RM4.29bil from RM4.38bil previously.

Group managing director and chief executive officer Kevin Lam said HLB remained cautiously optimistic about the business outlook and macroeconomic landscape for the remainder of FY24, as it focused on the execution of its business strategies to deliver sustainable outcomes to stakeholders.

“With that, we are pleased with the underlying sound 9M24 performance led by sustained loans/financing growth, healthy asset quality, solidified with prudent funding and liquidity positions,” he said.

In a separate Bursa Malaysia filing, HLB’s parent company, Hong Leong Financial Group Bhd (HLFG), recorded a higher net profit of RM818.07mil in 3Q24 from RM735.97mil from the same quarter in FY23, while revenue rose to RM1.7bil in the quarter under review against RM1.64bil previously.

For 9M24, HLFG’s net profit posted a net profit of RM2.39bil compared with RM2.22bil in 9M23, while revenue stood at RM4.93bil against RM4.99bil in the previous corresponding period.

HLFG said its insurance division, HLA Holdings Sdn Bhd, achieved pre-tax profit growth of 2.1% year-on-year (y-o-y) to RM453mil on stronger investment income as well as a higher share of associate profits.

The group’s investment banking arm, Hong Leong Capital Bhd, recorded a pre-tax profit of RM73.9mil, up 40% y-o-y due to higher stockbroking income and improved equity investment performance, but recorded a lower contribution from investment banking.

HLFG president and chief executive officer Tan Kong Khoon said the group’s performance was commendable as it achieved a return on equity (ROE) of 11.3%, underpinned by strong asset quality, robust loans/financing growth, improved investment income and higher contributions from associates.

“Going into the final quarter of our financial year, we are cautiously optimistic about the continuity of our business growth momentum as we anticipate Malaysia’s economy to remain resilient on the back of domestic demand and government economic initiatives.

“Nevertheless, we are cognisant of downside risks as the global economy faces external headwinds from evolving geopolitical and trade tensions between major economies,” he said.

Looking forward, Tan said the group remains focused on executing its strategic priorities in key growth areas, one of which is making wealth management more accessible to customers by enhancing its capabilities and solutions in line with its commercial bank’s brand promise of “Built Around You”. — BK