KUALA LUMPUR (Nov 26): AMMB Holdings Bhd (KL:AMBANK), the country’s sixth largest banking group by assets, is raising its dividend payout as earnings expanded in the recently ended quarter.

The company plans to distribute an interim dividend per share of 12.5 sen, up from 10.3 sen last year, according to an exchange filing. That raises the percentage of its net income paid out to shareholders to 39% from 34% over the comparable period in 2024.

The increase in interim dividend per share “reflects our confidence in our prospects despite a more challenging macro and geopolitical backdrop”, AMMB chief executive officer Jamie Ling said in a statement.

Net profit for the second quarter ended Sept 30, 2025 (2QFY2026) was RM534.58 million, an increase of 6.8% when compared to the same period last year, as both non-interest income and net interest income gained.

Year-on-year, net interest income rose about 3% on margin expansion while non-interest income climbed 12%, driven by higher trading gains in securities.

Net interest margin — a measure of a bank's profitability by comparing its income from loans to expenses on deposits — expanded one basis point year-on-year but shrank four basis points on a quarter-on-quarter basis.

Operating under the AmBank brand, the company said it remains optimistic on its prospects for the financial year but will remain vigilant in monitoring its asset quality, said Ling.

The company also remains on track with its Winning Together 2029 plan, confident that the five-year strategy outlined would boost performance through revenue growth, cost control, and technology investments.

“Looking ahead, I am confident that the AmBank Group will grow in tandem with Malaysia’s economy,” Ling added.

For the first six months of its fiscal year, net profit totalled RM1.05 billion, an increase of 5% from the same period last year, thanks to net interest income growth, led by higher margin on lower cost of funds, while non-interest income grew 13% from trading gains and insurance income.

Total gross loans, advances and financing grew about 1%, driven by business banking while customer deposits were down about 1%.

Gross impaired loan — the proportion of loans considered unlikely to be fully repaid — climbed eight basis points to 1.75% mainly from business banking though the company is able to fully absorb the potential debt turning sour with loan loss coverage, including regulatory reserves, at over 100%.

AMMB also noted that it remained well-capitalised, with common equity tier 1 capital ratio — a measure of a bank’s capital strength based on the highest quality of regulatory capital — of 15.25% post-dividend.