KUALA LUMPUR: Bank Negara Malaysia posted a higher net profit of RM7.56 billion in the year ended December 31 2018 from RM7.51 billion previously.
This is despite Bank Negara recording a lower total income of RM9.33 billion than the RM10.04 billion in 2017.
It had declared a RM2.5 billion dividend to the government for 2018, the central bank noted in its 2018 annual report which was released today.
“As audited and certified by the Auditor General, the financial position of Bank Negara remained strong in 2018,” it said, adding that its total assets amounted to RM447.6 billion.
Bank Negara said it was exempted from paying income tax and supplementary income tax as set out in the Income Tax (Exemption) (No. 7) Order 1989.
It only had RM21 million in tax expenses last year related to unclaimable withholding taxes on income from foreign dividend and interest and capital gains taxes on sale of foreign investments.
Meanwhile, Bank Negara said the capital position of banks in the country remained strong last year.
The banks also continued to record healthy profits, largely supported by income from financing activities and continued efficiency gains, Bank Negara said in its Financial Stability and Payment Systems Report 2018.
Commercial banks posted pre-tax profit of RM36.82 billion, up 1.5 per cent from RM35.32 billion in 2017 while their interest income rose 8.8 per cent to RM112.47 billion from RM102.49 billion.
Investment banks’ pre-tax profit fell 98.4 per cent to RM458.3 million from RM909.20 million in 2017.
Islamic banking pre-tax profit edged up 12.88 per cent to RM7.67 billion from RM6.68 billion in 2017.
For the overall banking system, Bank Negara said their pre-tax profits had grown at a slower pace, contributing to slightly lower annual returns on assets and equity.
"The slower profit growth was mainly due to higher provisions set aside by banks with the implementation of MFRS 9 and an increase in interest expenses on deposits, in line with the Overnight Policy Rate hike in January,” it added.