Revenue, however, was 4% higher at RM1.2 billion from RM1.15 billion.
Net impairment charges stood at RM190.4 million during the quarter compared to RM63.9 million in Q1 FY2023, which included a forward-looking charge of RM101.7 million, offset by overlay reversals of RM99.6 million.
CEO Sulaiman Tahir stated that AmBank successfully steered through net interest margin (NIM) compressions and bolstered its liquidity, with capital ratios showing further improvement in the first quarter.
“The strong growth in non-interest income (NII) from continuing operations was driven by trading gains in securities, higher fees earned from business banking, investment banking and asset management, as well as improved income from life and general insurance.
“A further RM51.1 million gain from the completion of our general insurance business disposal was recorded. Net interest income decreased by 6.3% due to NIM compression,” he said in a statement today.
The bank’s loan loss coverage ratio (LLC) stood at 115.6% during the said quarter, while the gross impaired loan (GIL) ratio was 1.66%.
“We continue to monitor our asset quality vigilantly by taking pre-emptive steps to manage accounts showing signs of delinquency and initiating restructuring and rescheduling exercises if appropriate,” he added.
The group also remained highly liquid, with the liquidity coverage ratio (LCR) improving to 170%.
Overall, gross loans and financing saw a slight 1% decrease to RM129 billion in Q1 FY2024, attributed to reduced customer activities.
This decline resulted in a year-to-date (YTD) reduction of -4.2% in the loans portfolio for wholesale banking and -3.7% YTD for business banking.
However, retail banking registered consistent loan growth of 1.3% YTD.
Sulaiman said that despite global challenges, namely restrained exports and limited international interest, the bank remains optimistic about its growth due to resilient domestic demand.
“As we embark on the final lap of our Focus 8 strategy, our ambition remains undeterred. The group is focused on its commitment to value creation for shareholders and stakeholders alike,” he said.
As at 4.51pm, AmBank’s share price was down by nine sen or 2.33% at RM3.77, giving it a market capitalisation of RM12.49 billion.