Financial Review by the Group Chief Financial Officer AZIZAN ABD AZIZ Group Chief Financial Officer STRONG GROWTH AND PROFITABILITY The Bank is proud to announce a Profit Before Zakat and Tax (PBZT) of RM746.9 million, reflecting a notable 6.1% increase over the previous year. This robust performance can be attributed to higher net income and lower net allowance for impairment on financing and advances, offset by higher total overheads. The Group's earnings per share of 22.86 sen and Return on Equity (ROE) of 7.5% (after tax and zakat) are testaments to our solid performance. However, our FY2022 Profit After Zakat and Tax (PAZT) slid 8% year-on-year due to the one-off Cukai Makmur. The Bank's increased net income can be attributed to higher net fund-based income, which increased by RM247.2 million or 13.5%, primarily driven by yearon-year financing growth and benefiting from multiple Overnight Policy Rate (OPR) revisions during the year. Despite a few OPR revisions during the year, our net income margin dropped by 7 basis points (bps) to 2.31%. This was mainly due to a higher average liabilities rate and lower treasury asset yield. However, we note that the liabilities rate was much higher in Q4 2022 as customers anticipated further OPR hikes in FY2023 and expected higher profit rates for renewal or new placement of deposits/investment accounts before the year's end. Our average assets rate for FY2022 was marginally higher by 18bps at 4.07% as compared to 3.89% a year earlier. In previous years, we had monetised our in-the-money financial assets at fair value through other comprehensive income (FVOCI) holdings, which we reinvested in shorter-tenor and lower-rate securities. This has affected the overall increase of the average asset rate for financing products. Finally, the Group's net allowance for impairment on financing and advances decreased by RM50.7 million or 26.6% to RM140 million compared to last year. This is a testament to the Bank's prudent risk management practices and credit quality assessment. 534,305 491,672 704,221 746,866 PAZT PBZT Net Income Revenue 2,188,942 2,309,946 3,167,757 3,576,354 12.9% 5.5% 6.1% -8.0% 2022 2021 Leadership Insights Bank Islam Malaysia Berhad 27 01 05 03 07 02 06 09 04 08
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