Bank Muamalat Bhd has returned to the black in a big way, with net profit soaring to its highest level since the bank started operations in 1999. Malaysia's second Islamic bank posted a net profit of RM32.3mil for the year ended Dec 31, 2005, against a loss of RM28.7mil in 2004.
Chairman Datuk Ismail Shahudin said the achievement was characterized by the enhanced focus and streamlined banking operations of consumer enterprise and investment as well as treasury and capital market services. “Significantly, the improved showing was also realized after absorbing the RM34mil payment for our voluntary separation scheme, concluded in June last year,” he said.
Ismail said the bank's revenue grew 33% to RM417.9mil, mainly due to income from financing portfolio and capital market activities. In the past, revenue grew by a mere 8.1%. Consumer activities accounted for 45% of revenue, up 5% from last year, while investment and treasury operations contributed 32.6% to turnover. The enterprise segment mainly generated the balance.
The non-performing loans (NPL) level improved to 6.8% in 2005 from 9.4% previously, while on a net basis, the ratio strengthened to 4.2% from 4.9% in 2004. The bank’s NPL stood at RM281mil compared with RM272mil the previous year.
At the operating profit level, the combination of sturdy contribution from investment and treasury activities underscored last year's gains. Contribution from investment banking was underpinned by the underwriting of some RM6bil of private debt securities in 2005.
The bank’s assets grew 27.2% to more than RM10bil last year from RM8.1bil in 2004.
Moving forward, the bank, owned 70% by Bukhary Capital Sdn Bhd, would leverage on its new ventures – Muamalat Venture Sdn Bhd and Muamalat Avenue Sdn Bhd – to tap the small and medium-scale enterprise financing market. [via The Star]