Maybank second quarter profit slides, says closely monitoring oil sector loans
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Customers leave a branch of Malaysia's Maybank in Putrajaya October 9, 2009. REUTERS/Bazuki Muhammad
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By Liz Lee
KUALA LUMPUR (Reuters) - Malaysia's biggest lender Malayan Banking Bhd (Maybank)
Slowing loan growth in Malaysia and higher provisioning for loan impairments across the region due to rising risks in industries such as oil and gas have hurt Southeast Asia's fourth largest bank by assets.
"We will... remain vigilant and maintain proactive management of asset quality while building our capital and liquidity positions," Group CEO Abdul Farid Alias said in a statement.
Net profit slid to 1.16 billion ringgit ($288.70 million) for the April-June quarter from 1.58 billion ringgit a year ago. Net interest income rose 7.5 percent to 2.88 billion ringgit.
The bank saw allowances for impairment losses jump to 982 million ringgit in the quarter from 301 million ringgit in the same period last year.
Group CFO Amirul Feisal Wan Zahir said Maybank was also monitoring the oil and gas sector. About 3.75 percent of the group's total loans were in that sector, he said.
"We are monitoring the sector closely in Malaysia and Singapore," Amirul told reporters.
Analysts have said Maybank has exposure to Swiber Holdings
Malaysian oil and gas service provider Perisai Petroleum Teknologi
Maybank said loans growth at home will likely continue to moderate to 6-7 percent this year from 7-8 percent in 2015 on the back of easing household loans growth.
It maintained its overall 2016 loans growth forecast of 8-9 percent. Maybank had seen 12 percent growth in the previous year.
Maybank's CEO did not rule out another 25-basis-point rate cut by the central bank this year, adding that the cuts could drive loan growth for the lender.
Last month, Bank Negara Malaysia surprised markets by cutting its overnight interest rate
(Writing by A. Ananthalakshmi; Editing by Muralikumar Anantharaman)
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