Hong Leong bucks rate cuts to post 16% profit

Hong Leong Bank Berhad net profit after tax for the nine months ending 31 March 2009 improved by 16 percent year-on-year to US$198 million.

At pre-tax level, profit rose 12 percent year-on-year to US$260 million, from US$232 million for the same corresponding period last year.

Earnings per share for the nine months ended 31 March 2009 was up 16 percent to US 13.7 cents compared to US 11.79 cents for the same period last year.

Notwithstanding the three consecutive cuts of the Overnight Policy Rate totaling 1.50 percent between November 2008 and February 2009, which directly compressed the net interest margin, Hong Leong Bank maintained sufficient earnings power.

"Hong Leong Bank has continued to post satisfactory results for the third quarter of its 2009 financial year despite the significant pressures on the economy and banking sector, in line with developments regionally and globally," commented Ms Yvonne Chia, Group Managing Director / Chief Executive.

While the leading indicators for growth moderated significantly over the last two quarters and external demand continues to be very weak in a global recession, Chia noted that Hong Leong Bank's capital and liquidity levels are strong.

"We hope that with the Government’s fiscal stimulus programme and the accommodative monetary environment, demand conditions should improve in the second half of 2009," Chia further commented.