RHB Bank (RHBBANK) Q1 2025 earnings summary

Executive summary

• Net profit rose 2.7% year-over-year to RM750 million, driven by higher net fund-based income and significant improvement in expected credit losses (ECL), partially offset by lower non-fund based income and higher expenses and taxes.

• Gross loans and financing grew 6.3% year-over-year to RM239.2 billion, mainly from mortgage, corporate, commercial, and auto finance segments.

• Customer deposits increased 2.3% year-over-year to RM248.5 billion, with a notable 31.3% growth in money market time deposits.

• Total income contracted marginally by 1.9% year-over-year due to a 20.2% decline in non-fund based income, partially offset by a 7.3% increase in net fund-based income.

• Cost-to-income ratio (CIR) increased to 47.4% from 45.9% year-over-year, reflecting income contraction despite contained cost growth.

Financial highlights

• Net profit: RM750 million, up 2.7% year-over-year.

• Net fund-based income: RM1.49 billion, up 7.3% year-over-year; non-fund based income: RM561 million, down 20.2%.

• Net interest income: RM969.8 million, up from RM926.0 million year-over-year.

• Operating profit before allowances: RM1,077.0 million; profit before tax and zakat: RM962.7 million.

• Net allowance for credit losses dropped to RM105.8 million from RM215.0 million year-over-year.

Outlook and guidance

• Loans growth guidance revised to 5%-6% for FY2025 (previously 6%-7%) due to market uncertainties.

• The group expects Malaysia's GDP to moderate in 2025 amid global economic headwinds, including US tariffs and trade tensions.

• NIM expected to remain under pressure; ECL may rise depending on tariff developments.

• Potential upside of ~RM1.7 billion from BNM's SRR reduction.

• Continued focus on cost optimisation and leveraging trading gains.