Revenue, however, was lower by 1.67% at RM1.18 billion from RM1.2 billion previously.
The banking group said its net impairment charges this quarter were lower at RM12.3 million (Q1 FY2024: RM190.4 million) due to “improved impairment charges in retail banking and business banking with higher forward-looking reversals during the quarter”.
Net interest income (NII) grew 6.4% year-on-year (y-o-y) to RM860.9 million (Q1 FY2024: RM808.7 million), on the back of a 13 basis points net interest margin (NIM) expansion to 1.89% (Q1 FY2024: 1.76%).
Gross loans, advances and financing grew 2.9% y-o-y mainly led by business banking loan growth of 16.5% y-o-y.
Non-interest income (NOII) was 19.2% lower y-o-y to RM317.6 million (Q1 FY2024: RM393.2 million) due to the “non-repeat of the AmGeneral Insurance Bhd divestment gain of RM51.1 million and lower trading and securities gain”.
“Continuing operations’ net income of RM1.178 billion was 2.4% higher y-o-y, led by NII growth of 6.4%, offset by a 7.1% decline in NOII,” AmBank Group said in a filing with Bursa Malaysia.
Total customer deposits dropped 4.8% year-to-date (YTD) to RM135.5 billion (FY24: RM142.4 billion) as the group managed its cost of funds and diversified funding sources to improve margins.
Time deposits remained flat YTD at RM89.7 billion (FY24: RM89.6 billion) while current and savings accounts (CASA) decreased 13.3% YTD to RM45.8 billion (FY24: RM52.8 billion).
The group remained highly liquid with a liquidity coverage ratio of 167.9% (FY2024: 164.6%) while the loan-to-deposit ratio was slightly higher at 97.9% (FY2024: 94.2%).
Moving forward, AmBank Group said its strategic focus will be to drive its SME and mid-corp segments to lead lending growth, build its wealth management offerings, and develop efficient supply chain solutions for customers.
“The group will continue to invest in technology, in line with its digitalisation agenda, to achieve operational excellence through improved process efficiency and the development of productivity tools,” it added.
As at 3.45pm, AmBank’s share price was up 11 sen or 2.25% at RM5, giving it a market capitalisation of RM16.57 billion.