The bank posted 1H10 net profit of RM1.875bn, up 44% yoy and 21% above expectations. Key takeaways from the results: (1) Net interest income increased 18% yoy to RM3.31bn due to the higher contribution from its 97.5%-owned PT Bank Internasional Indonesia (2) Income from Islamic banking operations increased 25% yoy to RM738m due to higher income derived from investing of depositors’ fund. (3) Non interest income increased 78% yoy to RM2.36bn on higher fee income, unrealized gains on revaluation of derivatives, forex profits and gain on sales of securities. (4) NPL ratio improved to 1.43% from FY09’s 1.64%.
It is currently trading at FY11E 1.7x P/BV, in-line with banking peers.