KUALA LUMPUR (Aug 27): Hong Leong Bank Bhd's (KL:HLBANK) fourth quarter ended June 30, 2025 net profit was up 5.28% on higher net interest income, stronger Islamic banking contributions and improved fee-based income.
Net profit for the quarter stood at RM1.09 billion, compared with RM1.03 billion a year ago.
Net interest income grew 4.16% to RM1.02 billion from RM981.1 million, while Islamic banking income surged 16.43% to RM302.6 million and other operating income rose 25.45% to RM295.7 million.
The group posted a pre-tax profit of RM1.36 billion for the quarter, up RM76.4 million or 6.0% from the same quarter last year.
The increase was mainly due to higher net income, which was up RM143.5 million, and lower operating expenses, which were down RM2.5 million.
However, this was partly offset by higher impairment losses on loans of RM34.1 million and lower profits from an associated company, which were down RM35.5 million.
The group posted revenue of RM1.62 billion for the quarter, compared with RM1.48 billion a year ago, its bourse filing showed.
The bank declared a final dividend of 68 sen per share, bringing the total payout for FY2025 to 96 sen per share — an increase of 28 sen compared with last year’s 68 sen dividend.
For FY2025, net profit edged up 1.84% to RM4.27 billion from RM4.20 billion a year ago. Net interest income was 4.34% higher at RM3.99 billion while other operating income surged 29.83% to RM1.25 billion.
“We are cautiously optimistic about the Malaysian economy this year, although a slowdown appears imminent given uncertainties and repercussions stemming from the US trade restrictions and policies, which will likely leave no countries with an open economy unscathed,” Hong Leong Bank group managing director and chief executive officer Kevin Lam said.
The bank's net interest margin — a measure of profitability from interest charged on loans after paying returns on deposits — was up four basis points to 1.90% in FY2025 from the same period a year ago.
Current account saving account (Casa) grew 9.6% year-on-year to RM78.5 billion, while gross loans and financing rose 7.8% year-on-year to RM210.1 billion.
In terms of asset quality, gross impaired loans — debts deemed unrecoverable as a percentage of total loans — came in at 0.54%, while loan impairment coverage was 96.8% at end-June this year.
Hong Leong Bank’s common equity tier 1 capital (CET1) — a measure of a bank’s capital strength based on the highest quality of regulatory capital — stood at 13.2%.
At noon break, shares of Hong Leong Bank were four sen or 0.2% higher at RM19.64 on Wednesday, valuing the bank at RM42.57 billion.