Malaysia's Maybank posts forecast-beating Q1 profit, cautious on 2015

Maybank posted a better than expected 6.3 per cent rise in quarterly profit, but gave a cautious outlook due to the launch of a new consumer tax in Malaysia in April. -- ST FILE PHOTO
Maybank posted a better than expected 6.3 per cent rise in quarterly profit, but gave a cautious outlook due to the launch of a new consumer tax in Malaysia in April. -- ST FILE PHOTO

KUALA LUMPUR (REUTERS) - Malayan Banking Bhd (Maybank), Malaysia's No.1 lender by assets, posted a better than expected 6.3 per cent rise in quarterly profit on higher fee income and robust loans growth but gave a cautious outlook due to the launch of a new consumer tax.

Net profit for January-March was 1.7 billion ringgit (S$603.1 million) compared with 1.6 billion ringgit a year ago, Maybank said in a stock exchange filing. This is higher than the average 1.58 billion estimate of two analysts, according to Thomson Reuters data.

Maybank, which is also South-east Asia's fourth-biggest bank, faces a challenging environment in the region this year as economic growth slows and currencies depreciate. At home, the lender sees weakening private consumption growth in the coming quarters, due to the implementation of a goods and services tax (GST) in April and the persistence of high household leverage.

Smaller rival CIMB Group Holdings Bhd announced last week a 45.6 per cent drop in first-quarter net profit, dragged by higher corporate loan provisions in Indonesia.

"The rest of the year is expected to remain challenging and we are closely monitoring regional developments, particularly the level of business activity post implementation of GST in Malaysia," group president and CEO Abdul Farid Alias said in a statement.

Maybank's first-quarter revenue rose 9.9 per cent to 9.18 billion ringgit. Loans for the quarter expanded 14.3 per cent year on year, led by its international markets which grew 19.4 per cent, according to the statement.

Shares of Maybank ended the midday break 0.6 per cent lower at 9.09 ringgit per share, prior to the earnings announcement. They have dropped 8.1 per cent over the past year, underperforming the benchmark stock index, which declined 6.0 per cent. Rival CIMB has dropped 23.2 per cent over the same period.