AFFIN Group recorded a Profit Before Tax (PBT) after zakat of RM449.7 million for the nine (9) months ended 30 September 2023 (9M2023), a decrease of 9.2% as compared to the same period last year (9M2022) of RM495.3 million on a business-as-usual basis excluding the AHAM gain on disposal last year.
Revenue for Q3 stood at RM500.4 million while profit was at RM100.4 million in comparison, FY22Q3 revenue was RM1.6 billion and profits came in at RM866 million.
The banking group said it made a gain of RM1.058 billion from the divestment of its Asset Management business in 2022 and that the profit has been impacted by Net Interest Margin (NIM) compression from the elevated cost of funds.
The President & Group Chief Executive Officer of AFFIN Group, Datuk Wan Razly Abdullah stated, “This year has been a challenging year with margin compression due to elevated cost of funds led by the US Federal Reserve. Globally, all banks are experiencing increased deposit cost. Capital Markets are beginning to price in an inverted yield curve, with the expectation of a pause in monetary policy, leading to an aggressive cut in Federal Reserve interest rates for 2024. Analysts are attributing this view on the anticipation of lower US inflation and rising US unemployment rates.
Net interest income (NII) was recorded at RM605.6 million, a decrease of RM150.5 million or 19.9% as compared to the previous financial period of RM756.1 million, mainly due to NIM compression.
As of 30 September 2023, the Group’s Total Capital ratio was at 18.08%, Tier 1 capital ratio at 15.61% and Common Equity Tier 1 (CET1) capital ratio at 14.60%. The Liquidity Coverage Ratio remains healthy at 175.94% in 9M2023, well above the regulatory requirement of 100%.
