The group reports higher operating income and buoyant performance in its digital business, with overall profit up by more than a quarter.
Malaysia-based bank CIMB characterized its performance as strong in 2023, with operating income, loans, and profit all up significantly from a year earlier, an announcement issued by the institution on Thursday indicated.
Net profit was up 28.3 percent at 6.98 billion ringgit (roughly 1.5 billion US dollars at current exchange rates), with rising operating income and lower provisioning levels in its main markets contributing to the result.
Record Dividend
Non-interest income was up 36.5 percent, offsetting the 3.5 percent decline it experienced related to net interest income. The bank characterized the interest rate environment as challenging given the «elevated» cost of deposits that it experienced in 2023. In contrast, the level of loans was up 8.3 percent.
CIMB will propose a record dividend payout to shareholders comprising an all-cash interim dividend added onto the full annual dividend as well as a special dividend. The total payout will be 4.59 billion ringgit.
Capital Ratios
The bank said its CET1 ratio was 14.5 percent, the total capital ratio 18.3 percent, and the liquidity capital ratio «well above» the regulatory requirement for 100 percent in all its entities across the group.
Consumer banking business income was flat although pre-tax profit rose 8 percent year-on-year. Commercial banking revenue was up 5.1 percent and pre-tax profit gained 22.6 percent. Wholesale banking income was up 5 percent while its digital assets and group funding area saw a strong 33.9 percent rise in operating income.
Strong Growth in Digital
«The Group’s digital businesses continue to grow strongly with TNG Digital reaching 15.7 million annual transacting users (“ATU”), a 70.7% increase year-on-year, and 1.3 million merchants as at December 2023,» the bank stated.
It said its Philippines business broke even after four years of operation and has since become one of the leading banks in the region with more than 7.4 million clients and a deposit book that is up by almost a quarter year-on-year.
Outlook
The CIMB Islamic business saw income rise 4.5 percent, although that was offset by a similar 4.5 percent decline in pre-tax profit because of diminishing margins even though the level of Islamic financing and deposits were up 13.8 percent and 11.5 percent respectively.
In its outlook, group CEO Datuk Abdul Rahman Ahmad said the bank «remains vigilant» of global economic uncertainty related to geopolitical tensions and the economic slowdown in China as well as the «continued industry competition for deposits».
«Our priority remains on completing our Forward23+ strategic plan and delivering on key focus areas, such as affluent and wealth management, strengthening our CASA and deposit franchise, as well as implementing effective balance sheet management to improve NIM regionally,» he indicated.
