Malayan Banking Bhd. (MAY), Malaysia’s biggest lender, said fourth-quarter profit jumped 16 percent as the Southeast Asian nation’s economy expanded at its fastest pace since 2010. Net income climbed to 1.46 billion ringgit ($469 million), or 17.29 sen per share, in the three months ended Dec. 31 from 1.26 billion ringgit, or 16.72 sen during the same period a year earlier, according to a stock exchange filing today. It declared a lower dividend of 33 sen per share.
Gross domestic product increased 6.4 percent in the ;last quarter as Prime Minister Najib Razak boosted spending ahead of an election that must be held by late June, extending cash handouts to low-income families and raising civil servants’ pensions. Earnings of Malayan Banking, or Maybank as the Kuala Lumpur-based lender is known, and rivals including Public Bank Bhd. (PBK) have benefited from higher domestic demand and investment.
“We are fortunate that we are based in a region of very robust growth,” Chief Executive Officer Abdul Wahid Omar told reporters in Kuala Lumpur today. “We are well placed to further grow international operations and will raise the tempo in our regionalization agenda.”
The stock rose 0.1 percent to 8.91 ringgit as of 12:35 p.m. after earnings were announced during the midday break. Maybank, which has operations in countries including Indonesia and Singapore, has fallen 3.3 percent this year, while the FTSE Bursa Malaysia KLCI Index slid 5 percent amid investor concern over the outcome of the election.
Net interest income, or revenue from borrowers after deducting interest paid to depositors, gained 2 percent to 2.19 billion ringgit in the quarter, and income from Islamic banking increased 7.1 percent to 526.5 million ringgit, Maybank said. Allowances for losses on loans and financing declined 30 percent to 160 million ringgit, the company said.