UOB Malaysia hits record high RM4.6b operating income and RM1.9b NPBT for FY2023
Kuala Lumpur, Malaysia, 10 May 2024 – UOB Malaysia reported a record total operating income of RM4.6 billion and net profit before tax (NPBT) of RM1.9 billion for the financial year ended 2023.
The Bank’s operating income grew by 19.3 per cent (2022: RM3.9 billion) and crossed the RM4.0 billion mark for the first time, while net profit before tax surged 44.4 per cent (2022: RM1.3 billion). The Bank’s financial performance for 2023 was disclosed in its Annual Report 2023 which was published on 9 May 2024.
The increase in operating income was backed by net interest income growth of 7.4 per cent to RM2.9 billion, and higher income contribution from Islamic Banking business, which increased by 14.8 per cent increase to RM169.6 million. Other operating income also grew by 50.0 per cent to RM1.6 billion, mainly driven by higher net foreign exchange gains and fee, and commission income.
By business pillars, UOB Malaysia’s operating income for Wholesale Banking surged by 18.5 per cent to RM2.1 billion, mainly backed by strong growth in Transaction Banking and Global Markets’ business flows, as the Bank continues to leverage its strong ASEAN footprint and Greater China connectivity to help businesses expand.
Since 2013, the Bank has supported more than 500 global companies to invest in Malaysia and facilitated more than 230 Malaysian companies in their regional expansion.
In line with UOB Malaysia's commitment to help local businesses, including the small and medium enterprises (SMEs), transition to sustainable practices, the Bank has provided RM6.2 billion green financing loans to-date. UOB offers one of the most comprehensive and market-leading sustainability financing framework and solutions validated by international and credible second party opinion.
Retail Banking operating income grew by 46.1 per cent to RM1.9 billion, primarily led by a significant increase in net interest income and fee and commission income, in part due to the consolidation of Citigroup’s Consumer Banking business. UOB Malaysia was the first of the four regional markets to integrate the former Citigroup customer base onto UOB’s platform in July last year.
Ms Ng Wei Wei, Chief Executive Officer, UOB Malaysia, said, "We are pleased to announce our record financial performance, driven by our key business pillars’ strong results and disciplined cost management. Guided by our three-year strategic plan, UOB Malaysia will continue to leverage our extensive footprint and expertise to help businesses unlock new avenues for growth across the region through cross-border trade and investment. As sustainability increasingly becomes a business imperative, we are committed to supporting local companies, especially the SMEs, transition to green practices and increase their competitiveness in the global value chain.”
“The acquisition of Citigroup’s Consumer Banking business has further strengthened UOB Malaysia’s retail franchise and unlocked new opportunities for better product offerings and global partnerships. With the successful integration in July 2023, the Bank will continue to extract value from the synergy of the two portfolios to drive growth,” she added.
Disciplined cost management, good funding and capital position
Meanwhile, UOB Malaysia’s operating expenses increased by 3.6 per cent mainly due to a one-off cost from the acquisition of Citigroup’s consumer banking business. The Bank’s total allowance for expected credit losses also increased by RM191.4 million to RM331.4 million, largely attributed to higher expected credit losses of non-impaired assets, commitments and contingencies due to prior year write-back, coupled with increased provisions for impaired assets.
In 2023, UOB Malaysia’s gross loans, advances and financing increased by 1.4 per cent to RM107.1 billion, with strong 11.0 per cent growth in trade financing. Meanwhile, non-bank deposits grew by 4.6 per cent to RM116.0 billion.
The Bank’s capital position continued to remain strong with Common Equity Tier 1 of 15.9 per cent and Capital Adequacy Ratio of 18.9 per cent, well above regulatory requirement providing sufficient buffer to support future growth.
UOB Malaysia’s Annual Report 2023 is available at uob.my/stakeholders/annual/annual.page.