KUALA LUMPUR: Affin Group recorded a profit before tax (PBT) after zakat of RM449.7 million for the nine months ended 30 September 2023 (9M2023), a decrease of 9.2 per cent compared with the same period last year (9M2022) of RM495.3 million on a business-as-usual basis, excluding the Affin Hwang Asset Management Bhd gain on disposal last year.
Affin made a gain of RM1.058 billion from the sale of its asset management business in 2022.
Affin Group's profit has been impacted by net interest margin (NIM) compression from elevated cost of funds.
Net interest income stood at RM605.6 million, a decrease of RM150.5 million or 19.9 per cent as compared with the previous financial period of RM756.1 million, mainly due to NIM compression.
Whereas non-interest income for the period under review was RM449.6 million, an increase of RM220.5 million or 96.2 per cent from RM229.1 million registered in the previous corresponding period, excluding the sales proceeds from the disposal of our asset management business.
"This year has been a challenging year with margin compression due to elevated cost of funds led by the US Federal Reserve. Globally, all banks are experiencing increased deposit cost."
"Capital markets are beginning to price in an inverted yield curve, with the expectation of a pause in monetary policy, leading to an aggressive cut in Federal Reserve interest rates for 2024. Analysts are attributing this view on the anticipation of lower US inflation and rising US unemployment rates," Affin Group president & group chief executive officer Datuk Wan Razly Abdullah said in a statement today.
Affin Group has made progress in its current account and savings account (CASA) strategy, which has grown 21.4 per cent year-on-year to RM16.6 billion.
The launch of the new AffinAlways Mobile App, which has seen 43,800 downloads in the past weeks, and the AFFINMAX Corporate Mobile App 2.0 is to the group's CASA and staying on track with its long-term A25 Transformation Plan.
It has also made great strides in terms of their digital initiatives, with another 117 technology projects expecting to go live in 2024.
These initiatives and strategic directions are part of Affin Group's continuous effort to evolve into a forward-looking, tech-enabled, and customer-centric organisation.
As of September 30, 2023, the gross impaired loan ratio for the group recorded an improvement of 1.84 per cent as compared to 1.91 per cent as of September 30, 2022.