AMMB ... Sept09

AMMB ON NET PROFIT TARGET OF RM800M TO RM900M FOR FYE MAR 2010

AMMB HOLDINGS is cautiously optimistic of meeting consensus estimates on Net Profit of RM800m to RM900m for the FYE Mar, 2010 as the world economy is still in a fragile condition, says Group MD - CHEAH TEK KUANG.

Deputy Group MD and Group CFO - ASHOK RAMAMURTHY said the Group maintained its cautious stance for the full year despite an outperformance for 1QE Jun 30, 2009 as there were not enough trends currently to indicate that the country's economic contractions would not be as severe as expected and capital market activities would continue to hold up. With these two factors and if the banking sector is not affected as expected, then our profit performance for the full year will be much bigger he said after the Company's AGM and EGM on Aug 13, 2009.

AMMB 1QE JUN 2009 NET PROFIT HIGHER BY 27%
For 1QE 2009, AMMB's Net Profit jumped 27% to RM258.2m while Revenue improved to RM1.53 bil from RM1.41 bil same period last year.

LOANS GROWTH TARGET & ROE OF 17% TO 20%
CHEAH said AMMB aimed to achieve loans growth of 6% to 8% for FY10 versus about 9% in FY09, which was 'roughly in line with the system.

MID-TERM TARGETS
AMMB's mid-term targets include generating RM1.2 bil in Net Profit for FYE Mar 2012 and achieving ROE of 17% to 20% over the next three years.

Earnings growth is expected to be driven by business banking, investment banking as well as relationship banking and regional business while retail business remains its main earnings contributor.

CHEAH said the Banking Group would remain active in the Debt Capital market while focusing on selected profitable segments like small and medium enterprises (SMEs), governmental contracts, oil and gas, hire purchase and mortgages.

NO SPIKE IN NPLs
RAMAMURTHY said while the Group's NPLs had hardly spiked up in 1QE Jun 2009, Malaysia's economic contractions in the remaining three quarters (of 2009) " ...are still on the cards ..." and the lag effect on the banking sector in terms of rising NPLs was anticipated towards the end of 2009. CHEAH said if the economy were to deteriorate, the impact would cut across the board although the SMEs and corporate banking segments were unlikely to see major NPLs.