Hong Leong Bank Bhd (HLB) reported a 4.4% increase in net profit for the second quarter ending Dec 31, 2023 (Q223), attributed to higher contributions from associate companies and write-backs from provisions.

The net profit reached RM1.087 billion for 2QFY2024, up from RM1.042 billion a year ago.

Despite a decline in net interest income, the group declared an interim dividend of 25 sen.

For the first half of the fiscal year (1HFY2024), HLB's net profit grew 4.7% to RM2.117 billion, with a 3.7% decrease in net interest income.

The bank's efforts in loan portfolio expansion and effective asset and liability management resulted in a net interest margin improvement to 1.85%, and a cost-to-income ratio of 39.7%.

HLB's gross loans and financing portfolio increased by 7.5% to RM185.2 billion in 1HFY2024.

The group's return on equity stood at 12.2%, with a stable gross impaired loan ratio of 0.56% and a loan impairment coverage ratio of 163.4%.

Meanwhile, Hong Leong Financial Group Bhd (HLFG), owning 64% of HLB, reported a 2.5% growth in net profit to RM831.87 million for 2QFY2024.

Despite a 0.4% decrease in net interest income, HLFG declared an interim dividend of 18 sen.

For 1HFY2024, net profit grew 6.2% to RM1.573 billion, while net interest income fell by 3.4%.

HLFG's President and CEO, Tan Kong Khoon, noted the positive financial performance in 1HFY2024 despite macroeconomic challenges.

He expressed caution for 2HFY2024 due to ongoing uncertainty, maintaining a focus on strategic priorities, including asset quality, cost control, and technology investment.

HLB shares traded at RM19.62, up by 2 sen or 0.10% today, , while HLFG shares gained 8 sen or 0.48% at RM16.68.