Photo by Sam Fong/The Edge

KUALA LUMPUR (May 21): Affin Bank Bhd (KL:AFFIN), the financial services arm of the Armed Forces Fund Board (LTAT), said on Tuesday its net profit down was 26% lower year-on-year (y-o-y) in the first quarter, on lower net interest income and other income.

Net profit for the three months ended March 31, 2024 (1QFY2024) stood at RM110.21 million, compared with RM148.98 million a year earlier, the bank showed in a bourse filing. Net interest income fell 6.6% y-o-y to RM361.98 million, while non-interest income surged 34% to RM142.56 million.

Affin Bank remains focused on expanding its current-account-savings-account (Casa) franchise and high-margin businesses, while optimising costs under its Axelerate 2028 plan, said president and group chief executive officer Datuk Wan Razly Abdullah Wan Ali.

During 1QFY2024, Affin’s total loans, advances and financing grew by 11.2% y-o-y to RM68 billion, contributed mainly by a 15% growth in the community banking segment. Housing loans also grew by 15.2%, whilst auto finance loans rose by 10.3%.

Affin’s Casa deposits were recorded at RM17.9 billion in 1QFY2024, as customer deposits increased by 8.9% y-o-y to RM71.8 billion.

"Our high-margin businesses have also shown growth, particularly in the personal financing segment” that expanded 27.1% y-o-y to RM6.1 billion, Wan Razly said. The credit card segment rose 23.4% y-o-y to RM461.5 million, he said.

In terms of asset quality, gross impaired loans — debts deemed irrevocable as a percentage of total loans — stood at 1.96%, a tad above the 1.90% targeted for the full FY2024. Loan loss coverage, however, declined to 102.33% from 116.86%.

Affin Bank’ common equity tier 1 capital ratio — a measure of a bank’s capital strength based on the highest quality of regulatory capital — stood at 13.44%, while its liquidity coverage ratio was 162.77% in 1QFY2024, well above the regulatory requirement of 100%.

At Tuesday's noon market break, shares in Affin Bank settled unchanged at RM2.55, valuing the company at RM5.98 billion.