BANK Islam Malaysia Bhd said net profit fell over 3% in the first quarter from a year earlier mainly due to higher provisions and overhead costs.
Net profit for the three months ended March 31, 2025 (1Q25) was RM126.27 million, according to an exchange filing today.
Allowance for impairment on financing and advances surged 89% to RM79.78 million in the current quarter due to a rise in loans turning sour.
Still, Bank Islam said its overall asset quality remains strong, and it would prioritise the expansion of wealth management, Ar-Rahnu and bureau-de-change services for 2025.
Gross impaired financing ratio – debts deemed unrecoverable as a percentage of total loans – was 1.08% at the end of March, well below the industry average of 1.42%.
Year-on-year, net interest income was up 2.1% to RM539.9 million from growth in financing and investment securities.
Gross financing grew 6%, outpacing the 5.5% rise in customer deposits and investment accounts.
Non-interest surged 50% to RM133.6 million on higher fees and commissions as well as income from foreign exchange transactions and net gains from investment securities.
Total overheads for the quarter rose nearly 4% to RM385.22 million, mainly due to an increase in establishment, personnel and marketing expenses.
Bank Islam’s common equity tier 1 capital – a measure of a bank’s capital strength based on the highest quality of regulatory capital – stood at 13% at the end of March 2025. — TMR
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