UOB Malaysia records a net profit after tax of RM1.22 billion in 2019
Bank continues to support its customers, colleagues and the community amid the challenges arising from COVID-19
KUALA LUMPUR, 20 May 2020 – United Overseas Bank (Malaysia) Bhd (UOB Malaysia) has reported a net profit after tax of RM1.22 billion for the financial year ended 2019, relatively flat from the previous year. The solid, albeit slightly lower, performance was driven by higher net interest and non-interest income, but partially offset by an increase in operating expenses and allowances for expected credit losses.
The Bank’s total operating income increased 3.2 per cent to RM3.10 billion in 2019, contributed by higher interest income from loans and debt instruments at fair value through other comprehensive incomes. The growth in net interest income was partially offset by higher interest expense from net placements of financial institutions. Non-interest income growth was supported by higher trading and investment income. Net income from the Bank’s Islamic Banking business also increased by 2.9 per cent to RM42.0 million during the year.
Total allowances for expected credit losses increased 9.9 per cent or RM20.6 million, mainly due to higher expected losses on loans, advances, financing and other financial assets. However, this was partially offset by a write-back in commitments and contingencies.
UOB Malaysia’s cost-to-income ratio increased slightly to 40.9 per cent in 2019 (2018: 39 per cent), while total operating expenses increased 8.6 per cent to RM1.27 billion as the Bank continued to invest in its talent and technology infrastructure to support business growth.
Gross loans, advances and financing rose 3.5 per cent to RM86.2 billion and non-bank deposits increased by 0.5 per cent to RM89.1 billion in the same period. The Bank maintained its sound asset quality by keeping its net non-performing loans ratio low at 1.5 per cent during the year.
Mr Wong Kim Choong, Chief Executive Officer, UOB Malaysia, said the Bank’s performance in 2019 reflected the slower global economic growth amid weaker global manufacturing and trade activities.
“Despite the moderation across advanced economies, subdued demand for goods and services and disruptions in the global supply chain, UOB Malaysia achieved solid performance for the financial year 2019. Backed by our strong balance sheet and effective resource management, we navigated the macro headwinds and stayed focused on helping our customers seize opportunities both at home and across ASEAN by tapping UOB Group’s regional expertise. The Bank’s performance in 2019 also underscores our robust corporate governance, strong risk management and sound business practices.”
#UnitedforYou COVID-19 Relief Programme
With the increasingly challenging operating environment due to the effects of the COVID-19 pandemic, UOB Malaysia remains focused on supporting its customers, colleagues and the community as part of UOB Group’s global #UnitedForYou COVID-19 Relief Programme.
Mr Wong said, “UOB Malaysia has a responsibility to help where it can, at a time when everyone is worried about their livelihoods, health and safety. The escalation of the COVID-19 contagion into a pandemic, in addition to ongoing trade disputes and geopolitical tensions, will significantly weaken global growth in 2020. COVID-19 lockdowns in many countries have disrupted supply and demand chains worldwide, resulting in material impact on the operations of many industries and businesses.”
To help cushion the impact of the pandemic on its customers’ financial well-being, UOB Malaysia has extended to its customers and colleagues a six-month moratorium on all loans, including mortgages and Islamic financing facilities. The Bank will also waive compounding interest on loans and mortgages for all eligible individual and small- and medium-sized enterprise customers during the six-month moratorium.
The Bank is also encouraging its customers to use its digital banking services, namely UOB Personal Internet Banking, UOB Business Internet Banking Plus and the UOB Mighty mobile app, in line with the safe distancing measures required of members of the public.
For its colleagues across its premises and branches, the Bank has implemented all necessary preventive measures, including thermal screening and daily cleaning and disinfection. It has also reduced the density of people at work through strict safe distancing measures as well as instructing them to work split shifts and across split sites.
To support communities affected by the pandemic, UOB Malaysia has launched the UOB Heartbeat COVID-19 Relief Fund to help alleviate the financial burden and distress many are facing during this difficult period through various initiatives. The funds will be used to provide beneficiaries with basic essential items such as food, hygiene products and educational materials. UOB Malaysia has also contributed RM500,000 through The Association of Banks in Malaysia to support MERCY Malaysia’s COVID-19 Pandemic Fund.
Mr Wong said, “We remain steadfast in support of our customers as their long-term financial partner, committed to serving them better through product innovation, technology and strategic partnerships to make banking safer, smarter and more convenient. For our colleagues, their families and the community, we will continue to take every precaution to ensure their safety and to support them as we prepare for recovery”.
“Having been in Malaysia for close to 70 years and in the region for more than 80 years, we have navigated through many challenges. We are positive of ASEAN’s long-term potential and are confident that we are well-positioned to weather the current storm and to emerge stronger.”
UOB Malaysia’s Annual Report 2019 is available at www.uob.com.my.