KUALA LUMPUR: AMMB Holdings Bhd recorded a net profit of RM707.64mil in the first half of its financial year ending March 31, 2022, which was a 17.45% improvement over RM602.48mil in the same period a year ago on higher total income and a lower net impairment charge from the previous year.

       In a statement, the group said it made good progress with profit before provisions growing 14% to RM1.35bil.

       "We are able to retain a tight control on costs, which led to our cost-to-income (CTI) ratio improving further to 42.7%.

       "The group’s net credit cost for H1FY22 stood at 61 bps (34 bps excluding overlay) with net provisions 1% lower YoY," said AmBank group CEO Datuk Sulaiman Mohd Tahir.

       AMMB said total income in 1HFY22 rose 5% year-on-year (y-o-y) to RM2.36bil due to higher net interest income (NII) from loans growth and net interest margin (NIM) expansion.

       Gross loans and financing rose 0.7% to RM115.6mil on higher loans from the mortgage, personal financial and business banking divisions.

       "Excluding the net modification impact, adjusted NII grew by 11.7% to RM1,550.9mil, with adjusted NIM of 1.96% compared to 1.8% for the same period last year," it said in a Friday statement.

       This mitigated a 17% decrease in non-interest income (NoII) due to lower trading and investment income from group treasury and markets, and insurance respectively.

       Over the six months period, the group's net impairment charge of RM377.1mil was lower compared to RM382.4mil a year earlier, resulting from higher model-driven forward looking (FL) provisions taken, offset by lower overlays.

       "As a proactive measure to bolster the group’s exposure to retail and SME customers as

       well as oil and gas sector, RM67.6mil of overlay was charged for the quarter under review.

       "Total preemptive overlays stood at RM900.4mil, of which RM745.5mil was charged in the previous financial years," it said.

       The banks gross impaired loans of 1.44% and loan loss coverage of 159%, up from 135.6% in FY21.

       Meanwhile, customer deposits fell 3.9% year-to-date to RM115.9bil and current account savings account (Casa) mix was higher at 30.7%.

       The bank's liquidity coverage ratio stood at 180.9% as at Sept 30, 2021.

       FHC CET 1 ratio and total capital ratio stood at 12.7% and 15.6% respectively.

       Moving forward, the group said in line with its Fous 8 strategy it would continue to explore new avenues for growth while preserving the long-term interest of its stakeholders through the strengthening of its balance sheet.

       "While we have assessed the potential impact of URUS to our second half earnings to be manageable, we continue to set aside pre-emptive provisions against certain loan portfolios, bringing our total overlay reserves to RM900mil.

       "We continue to be prudent and proactive in managing risks and the Group remains sufficiently

       capitalised and highly liquid,” said Sulaiman.