Latest news with #RHBBankBhd
The Star
5 days ago
- Business
- The Star
Analysts offer mixed outlook on RHB
PETALING JAYA: RHB Bank Bhd's prospects for the rest of the financial year appear balanced between resilience and caution, as analysts weigh solid fundamentals against macroeconomic uncertainties following the group's first-quarter results. Despite a 2.7% year-on-year rise in net profit to RM750.03mil for the three months ended March 31, 2025 (1Q25), brokerages are mixed in their outlook, citing slower gross domestic product (GDP) growth projections, credit cost risks and muted non-interest income (NOII) as key variables. Hong Leong Investment Bank (HLIB) Research noted that RHB has revised its loan growth guidance to 5%-6% from 6%-7%), in response to revised GDP growth expectations now 4.5% against 5%. Nevertheless, net interest margin (NIM) guidance remains intact, expected to be flat to +4 basis points (bps), excluding any overnight policy rate (OPR) cut, underpinned by concrete efforts to ease funding cost pressures through portfolio rebalancing, Singapore deposit rate repricing and leveraging statutory reserve ratio (SRR) liquidity, it said. HLIB maintained a 'buy' rating with an unchanged target price of RM7.70, calling the stock attractive at 0.88 times price-to-book (P/B) due to a dividend yield of 6.7%. TA Research was similarly upbeat, reiterating a 'buy' and raising its target price to RM7.52 from RM7.00. It highlighted that 'management remains cautiously optimistic about the outlook for 2025', with credit cost guided at 15–20bps and return on equity (ROE) forecast at 10.4%–10.8%. The bank's focus on mitigating risks through early restructuring efforts was also noted, especially for small and medium enterprises (SME) exposures, with RHB proactively engaging with potentially affected borrowers and has reinforced its early restructuring and rescheduling (R&R) initiatives. TA also underscored stable NIM expectations of 1.86% to 1.90%, aided by the recent SRR cut and an improving current-account-savings-account (CASA) ratio. However, Maybank Investment Bank (MaybankIB) Research struck a more cautious tone, revising its call to 'hold' from 'buy' and cutting its target price to RM7.10 from RM7.70. It stated that 'RHB's 1Q25 core net profit was below expectations, largely on account of lower-than-expected NOII'. Reflecting a weaker macroeconomic backdrop, MaybankIB has cut its 2025-2027 earnings for RHB by 8%-9%, largely to factor in slower economic growth, a potential rate cut and lower NOII, and added that it has raised credit costs by 20% from 3bps. CIMB Research, meanwhile, maintained a 'buy' call with an unchanged target price of RM7.50, asserting that dividend yield will likely remain close to 5.5%, even under a more stressed scenario. It believes key catalysts for RHB include 'higher-than-expected NIM, better asset quality, higher-than-expected loan growth, and sustained dividend payout'. However, it warned of downside risks from 'higher-than-expected cost of funds' and 'uptick in impaired loans'. The bank's key performance index targets for 2025 include ROE of 10.4%–10.8%, loan growth of 5%–6%, NIM of 1.86–1.90%, and a dividend payout ratio of 30%–50%. Credit cost is expected to be kept within 15–20bps, while the cost-to-income ratio is guided at 45.5–46%. For 1Q25, RHB reported revenue of RM4.39bil, marginally lower than RM4.40bil in the previous year. Net profit of RM750.03mil was up from RM730.17mil previously.
The Star
5 days ago
- Business
- The Star
RHB sustains growth
PETALING JAYA: RHB Bank Bhd (RHB) is keeping a cautious stance amid evolving macroeconomic conditions, shaped by interest rate movements and global trade dynamics, although it expects the recent reduction in the statutory reserve requirement by Bank Negara to provide funding flexibility in the quarters ahead. In addition, the lender is projecting for the banking sector to maintain its strong capital and liquidity positions. RHB's group managing director and group chief executive Datuk Mohd Rashid Mohamad said the bank's new three-year strategic roadmap, named PROGRESS27, has set a clear course for the lender toward becoming the best in service, enhancing profitability and reinforcing its purpose-driven commitment. 'With focused execution priorities, from simplifying customer journeys to advancing our sustainability ambitions, we are well-positioned to deliver near-term value while unlocking long-term value for all stakeholders,' added Mohd Rashid. Releasing its results for the first quarter ended March 31 (1Q25) yesterday, RHB saw net profit inch up by 2.7% year-on-year (y-o-y) to RM750mil, despite a marginal dip in revenue to RM4.39bil. The 1Q25 performance translates to an earnings per share of 17.2 sen. The group attributed the growth in net profit primarily to higher net funding income and improved credit cost management, which was offset by lower non-fund based income, higher tax expense, higher operating expenses and higher share of loss in associates. At the same time, it reported that total income stood at RM2bil, a marginal dip of 1.9% y-o-y mainly from contraction in non-fund based income due to lower net gain on foreign exchange (forex) and derivatives, as well as net trading and investment income. RHB said it has maintained operational stability, supported by prudent cost management, continued strength in capital and liquidity positions, reflected by the containment of cost growth at 1.2%, while cost-to-income ratio stood at 47.4% from 45.9% a year ago, reflecting the marginal contraction in income. Commenting on the results, Mohd Rashid remarked that the sustaining of the bank's earnings growth momentum in 1Q25 was underpinned by solid fundamentals and early traction from its PROGRESS27 strategy. 'Our cost optimisation efforts are beginning to deliver results, enabling us to contain expenses while driving growth in key segments. 'At the same time, our continued focus on asset quality has led to a reduction in credit cost. We remained disciplined in execution, strengthening our core capabilities, driving operational excellence, and unlocking new growth opportunities.' Net fund based income increased by 7.3% to RM1.49bil y-o-y on the back of gross loans and financing growth of 6.3%, while non-fund based income declined by 20.2% to RM561mil from a year ago, driven by lower net trading and investment income, lower net gain on forex and derivatives as well as lower income from its insurance business, partly offset by higher fee income. Net allowance for credit losses was lower at RM105.8mil, primarily due to lower credit losses on loans and financing. Meanwhile, total assets of the group increased by 0.7% from December 2024 to RM352.5bil as at March 31, 2025, with net assets per share at RM7.39, and shareholders' equity at RM32.2bil. Concurrently, the group's gross loans and financing grew by 6.3% y-o-y to RM239.2bil, mainly supported by growth in mortgage, corporate, commercial and automotive finance. RHB's gross impaired loans (GIL) increased marginally to RM3.6bil, with a GIL ratio of 1.50%, from 1.47%, or RM3.5bil in December 2024. The group reported a domestic GIL ratio of 1.22%, which is lower than the banking industry's GIL ratio of 1.42%. Loan loss coverage ratio for the group, including regulatory reserves, improved to 115.7%, while it stands at 76.9% if regulatory reserves are excluded. Customer deposits increased by 2.3% to RM248.5bil, primarily due to growth in money market time deposits by 31.3%, offset by a decrease in current accounts and saving accounts (Casa) by 1.1% and fixed deposits by 0.9%. Casa composition stood at 28.0% as at March 31, 2025, and liquidity coverage ratio remained sound at 134.6%. Compared to the previous quarter ended December 2024, RHB saw net profit decrease by 10.1% from RM834.5mil, which it attributed mainly to lower non-fund based income and higher allowances for credit losses. These were partly offset by lower operating expenses, higher net funding income, lower impairment on other non-financial assets and lower share of loss in associates during 1Q25. RHB did not declare any dividends for the quarter.
The Sun
6 days ago
- Business
- The Sun
RHB posts RM750m first-quarter net profit
KUALA LUMPUR: RHB Bank Bhd registered a net profit of RM750 million in the first quarter of its financial year ending Dec 31, 2025 (Q1'25), an increase of 2.7% from the previous corresponding period. This was primarily attributed to higher net fund-based income and improved credit cost management, reflecting the group's disciplined risk management and strong base. Total income stood at RM2 billion, a marginal dip of 1.9% Y-o-Y mainly from contraction in non-fund based income due to lower net gain on forex and derivatives, and net trading and investment income. The group maintained operational stability, supported by prudent cost management, continued strength in capital and liquidity positions. Cost growth was contained at 1.2% whilst CIR stood at 47.4% from 45.9% a year ago, reflecting the marginal contraction in income. RHB Banking Group managing director/group CEO Datuk Mohd Rashid Mohamad remarked, 'We sustained our earnings growth momentum in the first quarter, underpinned by solid fundamentals and early traction from our PROGRESS27 strategy. Our cost optimisation efforts are beginning to deliver results, enabling us to contain expenses while driving growth in key segments. At the same time, our continued focus on asset quality has led to a reduction in credit cost. We remained disciplined in execution, strengthening our core capabilities, driving operational excellence, and unlocking new growth opportunities.' The group's total assets rose to RM353 billion, supported by healthy balance sheet growth and prudent capital management. At group level, the shareholders' equity stood at RM32 billion, with the Common Equity Tier-1 (CET-1) ratio of 16% and Total Capital Ratio (TCR) at 18.5%, reinforcing a strong capital position to support future growth ambitions, as well as to cushion macroeconomic uncertainties. Whereas the bank's CET-1 and TCR stood at 14.7% and 17.4%, respectively. Loan loss coverage ratio including regulatory reserves, improved to 115.7%, reflecting sound provisioning practices. Domestic loan growth of 4.7% (annualised) outpaced the industry's 4.3%, while the group's GIL ratio remained well-contained at 1.5%, and the domestic GIL ratio was below the industry average, demonstrating sound credit quality. The group remains cautious amid shifting rates and global trade uncertainty. The recent reduction in Statutory Reserve Requirement by Bank Negara Malaysia is expected to provide funding flexibility in the quarters ahead. 'Our new 3-year strategic roadmap, PROGRESS27, sets a clear course towards becoming the best in service, enhancing profitability, and reinforcing our purpose-driven commitment. With focused execution priorities, from simplifying customer journeys to advancing our sustainability ambitions, we are well-positioned to deliver near-term value while unlocking long-term value for all stakeholders,' said Mohd Rashid.
New Straits Times
6 days ago
- Business
- New Straits Times
RHB Bank's 1Q profit rises to RM750.03mil
KUALA LUMPUR: RHB Bank Bhd posted a higher net profit of RM750.03 million for the first quarter ended March 31, 2025 (1Q 2025) compared with RM730.17 million in the same period last year. The year-on-year (y-o-y) improvement was mainly due to higher net funding income and lower allowances for credit losses, offset by lower non-fund-based income, higher tax expense, higher operating expenses and higher share of loss in associates. Revenue, however, slid to RM4.39 billion from RM4.40 billion in 1Q 2024. In a filing with Bursa Malaysia today, RHB Bank said net fund-based income increased by 7.3 per cent to RM1.48 billion y-o-y on the back of gross loans and financing growth of 6.3 per cent. It added that the group's gross loans and financing grew by 6.3 per cent y-o-y to RM239.2 billion, mainly supported by growth in mortgage, corporate, commercial and auto finance. RHB Banking Group's group managing director and group chief executive officer, Datuk Mohd Rashid Mohamad, said the company sustained its earnings growth momentum in the first quarter, underpinned by solid fundamentals and early traction from the group's three-year PROGRESS27 strategic roadmap. "Our cost optimisation efforts are beginning to deliver results, enabling us to contain expenses while driving growth in key segments. "At the same time, our continued focus on asset quality has led to a reduction in credit cost. We remained disciplined in execution, strengthening our core capabilities, driving operational excellence, and unlocking new growth opportunities," he said. On outlook, the group maintained a cautious stance amidst evolving macroeconomic conditions shaped by interest rate movements and global trade dynamics. "The recent reduction in the statutory reserve requirement by Bank Negara Malaysia is expected to provide funding flexibility in the quarters ahead. "With focused execution priorities, from simplifying customer journeys to advancing our sustainability ambitions, we are well-positioned to deliver near-term value while unlocking long-term value for all stakeholders," he added.
The Star
6 days ago
- Business
- The Star
RHB Bank maintains growth with 1Q net profit of RM750.03mil
RHB Banking Group's group managing director/ group chief executive officer Mohd Rashid Mohamad —YAP CHEE HONG/The Star KUALA LUMPUR: RHB Bank Bhd sustained earnings growth in the first quarter of 2025 (1QFY25) with cost optimisation efforts and a focus on asset quality yielding results. 'Our new 3-year strategic roadmap, PROGRESS27, sets a clear course toward becoming the best in service, enhancing profitability, and reinforcing our purpose-driven commitment. "With focused execution priorities, from simplifying customer journeys to advancing our sustainability ambitions, we are well-positioned to deliver near-term value while unlocking long-term value for all stakeholders,' said group managing director and CEO Datuk Mohd Rashid Mohamad in a statement. During the quarter under review, RHB recorded a net profit of RM750.03mil, up from RM730.17mil in the year-ago quarter. The group reported revenue of RM4.39bil, which was slightly lower than RM4.4bil in the comparative quarter, while earnings per share rose to 17.2 sen from 17.03 sen previously. According to the bank, net fund-based income increased 7.3% year-on-year (y-o-y)to RM1.5bil, on the back of higher gross loans. Net interest margin improved from 1.83% to 1.84% over the one-year period. "The group continued to proactively manage its funding costs through active liability management initiatives. Taking this into account, the effective NIM for the quarter was 1.91%," it said. Non-fund based income, however, fell 20.2% y-o-y to RM600mil, mainly owing to lower net gain on forex and derivatives, and net trading and investment income. On an annualised basis, the group's gross loans grew 2.4% to RM239bil, supported by growth in the group community banking and commercial segments, respectively. Customer deposits was RM249bil, with current account savings account (Casa) composition improving to 28% from 27.6% In December 2024.
