CIMB Group Holdings Berhad recorded a resilient financial performance with profit before tax (PBT) of MYR 5.27 billion ($1.20 billion) and net profit of MYR 3.86 billion ($0.88 billion) for the first half of 2025, despite macroeconomic headwinds, increased market volatility and foreign exchange (FX) translation effects. Although net profit declined by 0.9% year-on-year, on a constant currency basis, net profit would have increased by 3.3%. Despite the challenging environment, the group delivered an annualised return on average equity (ROE) of 11.1% and an earnings per share (EPS) of 36.0 sen. Accordingly, the group proposed an all-cash first interim dividend of 19.75 sen per share based on a consistent payout ratio of 55.5%, which translates to a total dividend payout of MYR 2.1 billion ($0.48 billion). Operating performance Operating income increased 1.9% quarter-on-quarter for the group, driven by both net interest income (NII) and non-interest income (NOII), resulting in pre-provision operating profit (PPOP) rising 4.5% quarter-on-quarter. NII remained stable at MYR 3.83 billion ($0.87 billion), up 0.4% despite continued rate cuts in Indonesia, Thailand and Singapore, while NOII grew 5.3% on the back of strong trading income, which rose 10.4%. A deposit-led strategy combined with prudent asset-liability management also helped to keep NIM steady at 2.15% in the second quarter of 2025. On a constant currency basis, CIMB’s total assets and gross loans grew by 6.1% and 3.6% year-on-year, respectively without compromising asset quality. The group continues to expand total deposits by 4.9% year-on-year, with total current and savings account (CASA) growing 10.0%. This contributed to a positive CASA ratio of 44.0% as at June 2025, up from 40.9% recorded a year ago. The group’s cost-to-income ratio (CIR) came in at 46.2% in the first half of 2025, reflecting overall cost discipline while operating cost declined 1.1% quarter-on-quarter even as the group continues to invest in technology and operational resilience. Asset quality remained robust with additional reallocation of overlays in the second quarter of 2025, bringing credit cost to 29 bps and contributing to a healthy allowance coverage ratio at 100.7%. Gross impaired loans (GIL) ratio improved both quarter-on-quarter and year-on-year to 2.1% as at June 2025, reflecting CIMB’s strong asset quality in all markets. Common Equity Tier 1 (CET1) ratio remains strong at 14.7% as at June 2025, providing flexibility to optimise shareholder returns. Forward30 strategic plan CIMB continues to execute its Forward30 strategy with discipline and agility, positioning the franchise to capture growth opportunities amidst an evolving macroeconomic backdrop. During the quarter, the group accelerated multiple strategic initiatives to drive growth, including introducing additional products and services on its OCTO consumer banking app throughout the region to double down on the bank’s wealth strategy, MYR 10 billion ($2.27 billion) in financing commitments towards the Johor-Singapore Special Economic Zone (JS-SEZ), and the rollout of ecosystem initiatives in business banking, targeting healthcare and real estate sectors to support sustainable growth and long-term resilience of SMEs. The group’s cross-selling strategy continues to gain traction, with fee and commission income up 2.0% year-on-year, treasury client sales rising 3.3% year-on-year, and wealth assets under management (AUM) expanding 10.9% year-on-year, backed by the strength of the group’s ASEAN network and its deep client relationships across segments. Technology and digitalisation investments remain at the core of its strategic plan, underpinning CIMB’s efforts to enhance customer experience, improve efficiency and scale growth across ASEAN. TNG Digital, under the group’s digital assets portfolio, continues to deliver profitability, serving 30 million customers and 2 million merchants. In addition, CIMB will be launching its new business banking app, OCTOBiz, across Malaysia and Indonesia in the fourth quarter of 2025, with further rollouts planned across other markets. These initiatives underscore the group’s commitment to delivering sustainable returns and to be the bank of choice, while reinforcing its position as a leading focused ASEAN bank. In line with its purpose to advance customers and society, the group raised its sustainable finance target to MYR 300 billion ($68.2 billion) by 2030 to power a greener and more inclusive ASEAN economy. In addition, CIMB pledged MYR 200 million ($45.5 million) to drive long-term economic empowerment, community wellbeing and financial inclusion across the region, ensuring sustainable progress for all over the next five years. The group also committed over MYR 100 million ($22.7 million) in 2025 for investment in training and development focusing on digital and AI to ensure a future-ready workforce. Outlook Novan Amirudin, group chief executive officer of CIMB Group said, “Amidst ongoing economic volatility, we are staying closer to our customers while navigating the current landscape prudently. With greater clarity on global tariff developments, we are seeing business confidence gradually improving. Our proactive asset-liability management has allowed us to preserve NIM stability through rate adjustments, supported by strong asset quality and a healthy loan-to-deposit ratio of 88.0%. Our well-capitalised balance sheet not only ensures the resilience of our franchise but also provides us with the flexibility to execute future growth and strategic priorities. This allows us to continue delivering sustainable returns while supporting future capital distribution, reaffirming our commitment to create long-term sustainable shareholder value.” Redisseminated by The Asian Banker
