KUALA LUMPUR (May 10): UOB Malaysia said Tuesday (May 10) that the bank recorded a 12.2% year-on-year (y-o-y) increase in net profit to RM1.14 billion in 2021 on higher operating income and lower total allowance for expected credit losses.
The bank said in a statement its total operating income grew 4.3% to RM3.35 billion, on the back of stronger net interest income and higher net income from the Islamic banking business.
Meanwhile, UOB Malaysia noted that its total allowances for expected credit losses were 17.7% or RM103.2 million lower compared with the previous year.
The decrease was largely due to lower expected credit losses on loans, advances, financing and other financial assets for non-impaired assets, it added.
While prudently managing its discretionary expenses, UOB Malaysia said it continued to invest in technology infrastructure in 2021 to support its business growth, which resulted in a 5.7% increase in total operating expenses to RM1.36 billion.
According to UOB Malaysia, gross loans, advances and financing base rose 2.9% to RM90 billion, and non-bank deposits increased 3.7% to RM97.1 billion in 2021.
Amid a challenging environment, the banking group said its wholesale banking loans and financing grew steadily, riding on the bank’s Islamic banking capabilities as well as its regional networks. The bank was the second largest loan bookrunner in Malaysia in 2021, it added.
In addition, the total foreign direct investment (FDI) transactions facilitated by the bank increased by close to 20%, compared with the year before.
These flows included new investments from Greater China, ASEAN, South Korea and the United States.
Meanwhile, the bank said it continued to maintain a strong capital base with its common equity tier 1 ratio at 17.7% and total capital ratio at 20.5%.
It added that its liquidity and funding positions also remained robust with its liquidity coverage ratio and net stable funding ratio well above the minimum regulatory requirements.
Throughout the pandemic, UOB Malaysia said it continued to support its customers, especially individuals, micro-enterprises as well as small and medium enterprises (SMEs) through its Covid-19 Relief Assistance Programme.
It noted that from March 2020 to December 2021, the programme has benefited more than 34,000 individual, micro-enterprise and SME customers.
It added that the relief assistance extended involved more than RM23 billion loans and financing, and has helped customers overcome the financial impact caused by the prolonged movement restrictions.
“Amid the volatile operating environment in 2021, we delivered a commendable performance, growing our operating income and net profit. Through prudent risk management and disciplined business approach, we kept our balance sheet robust while continuing to capture opportunities and grow market share.
“Going forward, we remain focused on enhancing our technology infrastructure to drive innovation and performance. We will also continue to support our customers to capitalise on ASEAN’s structural growth trends, as well as to transition to sustainability through our suites of financing solutions,” said UOB Malaysia chief executive officer (CEO) Ng Wei Wei.
Ng in the statement said Malaysia’s recovery is gaining momentum, and she expects a strong rebound in economic growth.
“We are confident of Malaysia’s development, which is underscored by our continued investment to deepen our presence in the country and to develop our people.
“Our commitment is further reaffirmed by our recent acquisition of Citigroup’s consumer banking business in Malaysia, subject to regulatory approval, and investment in our new headquarters in the heart of Kuala Lumpur,” she said.
In the Tuesday statement, UOB Malaysia also extended its deepest appreciation to Wong Kim Choong, who stepped down as its CEO on April 30, 2022 and will continue to contribute to the bank’s development through his new role as senior adviser on the Citi consumer banking acquisition.