RHB Bank (RHBBANK) Q2 2024 earnings summary

Executive summary

• H1 2024 net profit was RM1.5 billion, with ROE at 9.6% and cost-to-income ratio improving to 46.3%.

• Total income rose 10.9% year-over-year to RM4.2 billion, driven by higher net fund-based and non-fund-based income.

• Loans grew 2.5% year-to-date (annualised 4.9%) to RM227.9 billion; total assets rose 1.0% to RM331.9 billion.

• Interim dividend of 15 sen per share declared, with a 45% payout ratio.

• Net assets per share stood at RM7.27, with shareholders' equity at RM31.7 billion.

Financial highlights

• Net fund-based income increased 4.0% to RM2.8 billion; non-fund-based income surged 28.5% to RM1.4 billion, including a one-off gain from the disposal of a subsidiary.

• NIM strengthened to 1.86% (1.97% including liability management initiatives), up from 1.82% in FY2023.

• Operating expenses rose 8.1% to RM1.95 billion, mainly due to higher personnel, IT, and marketing costs.

• Credit cost increased to 24 bps from 16 bps in FY2023, with net allowance for credit losses at RM360 million.

• Customer deposits increased 4.8% year-over-year to RM240.3 billion, with CASA ratio at 28.1%.

Outlook and guidance

• Focus on optimising cost of funds through liability management and CASA initiatives, including MySiswa and Multi Currency Accounts.

• Continued emphasis on asset quality management and operating expense optimisation.

• Targeting further automation and digitalisation, with 48% of key processes automated and 73% of systems modernised.

• Economic growth in Malaysia expected to remain resilient, with positive banking industry outlook.

• Group will focus on asset quality improvement, especially in regional operations, and maintain prudent fundamentals through its TWP24 strategy.