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Indonesian ops dent CIMB Q2 net [New Straits Time (Malaysia)]
[September 01, 2014]

Indonesian ops dent CIMB Q2 net [New Straits Time (Malaysia)]

(New Straits Time (Malaysia) Via Acquire Media NewsEdge) KUALA LUMPUR: CIMB Group Holdings Bhd announced yesterday net profit declined 9.9 per cent to RM950 million in the second quarter ended June 30, compared to a year ago, on a weak performance in Indonesia, and also named its head of investment banking as acting chief executive officer (CEO).

Tengku Datuk Zafrul Tengku Abdul Aziz will take on the top position from Monday, with current chief executive Datuk Seri Nazir Razak assuming the chairman post as previously announced.

In the latest quarter, CIMB's revenue fell one per cent to RM3.40 billion from RM3.44 billlion a year ago. Earnings were 11.36 sen compared with 14 sen before.

For the January-June period, CIMB's net profit dropped 17.21 per cent to RM2.02 billion from RM2.44 billion a year ago.

Its revenue for the six-month period declined 5.9 per cent to RM6.95 billion from RM7.39 billion a year ago.

"It was a difficult first half due mainly to the tough conditions in Indonesia and the sharply weaker rupiah," Nazir told a news conference, here, yesterday.

"This has caused CIMB Niaga's profit before tax (PBT) contributions to decrease by 19.8 per cent," he said.

Nazir said low financial market volumes and volatility across the region led to weaker investment banking and treasury businesses.

However, excluding Indonesia and CIMB Group's exceptional gain last year, he said the bank's PBT was up 5.9 per cent year-on-year due to strong performances of its local consumer bank, CIMB Singapore and CIMB Thai.

Nazir said the main challenge for the second half of the year remains Indonesia, in view of the prevailing economic and liquidity environment there.

CIMB also expects its operations in Malaysia and Singapore to continue growing strongly while Thailand is showing signs of an improving economy.

On another development, he said discussions remain ongoing on the bank's mega merger deal with RHB Capital Bhd and Malaysian Building Society Bhd (MBSB).

"This is our third attempt to acquire and merge with RHB Capital ... they say the third time is always lucky," Nazir said, indicating that he has strong faith in the progress of the deal.

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