Kuala Lumpur, 30 November 2023: Malaysia’s leading independent investment bank,
Kenanga Investment Bank Berhad (“Kenanga” or “The Group”) today announced an increase
in revenue and profit before tax (“PBT”) of RM219.7 million and RM28.2 million respectively
in the quarter under review (“3Q23”), compared to the corresponding period in the previous
year (“3Q22”) when revenue was RM181.8 million and PBT was RM17.4 million, due to the
increased gross interest, brokerage fees and trading and investment incomes. Net profit for
3Q23 increased 4.1 folds to RM23.6 million.
For the nine months period ended 30 September 2023 (“9M23”), revenue and PBT increased
to RM597.8 million and RM63.9 million respectively against the revenue of RM543.6 million
and PBT of RM59.1 million in the same period last year (“9M22”). The growth was primarily
driven by higher trading and investment income, a reversal of credit losses, and increased
shares of profit from associates and joint ventures.
Kenanga’s Stockbroking division reported a 50.9% uptick in revenue to RM79.2 million in
3Q23, relative to the revenue of RM52.5 million in the same period last year, while PBT
achieved a positive turnaround at RM1.0 million against a loss before tax (“LBT”) of RM18.5
million in 3Q22 mainly due to the higher brokerage fee and trading and investment income.
This positive shift was primarily due to the reversal of impairment on margin accounts, as well
as bad debt recoveries.
Investment Banking division’s revenue and PBT rose to RM62.1 million and RM5.2 million
respectively in 3Q23, against the revenue of RM50.4 million and PBT of 4.7 million in 3Q22.
Regardless the rise in investment banking fee income, it was partially offset by higher provision
of credit loss expenses.
The Group’s Investment and Wealth Management recorded lower revenue and PBT of
RM71.4 million and RM13.4 million respectively in the quarter under review, compared to the
revenue of RM74.0 million and PBT of RM19.8 million in 3Q22. This was predominantly
attributable to lower management fees income and higher expenses resulting from a rise in
personnel costs due to expanded sales force, information technology expenses and marketing
activities.
The Group’s Listed Derivatives business registered a jump in revenue of 8.7% from RM5.8
million in 3Q22 to RM6.3 million in 3Q23, while PBT more than doubled from RM0.9 million in
the previous corresponding quarter to RM1.9 million in the quarter under review. This was due
to the higher interest income from its trust deposits.
The Money Lending and Financing division, Kenanga Capital, recorded lower revenue of
RM0.6 million in 3Q23 against the revenue of RM2.2 million in 3Q22. It also recorded a LBT
of RM72,000 in the quarter under review, against a PBT of RM0.3 million in the same period
last year. The decline was primarily attributed to lower interest income and fees income
following the partial disposal of its equity stake in its previous subsidiary, Kenanga Capital
Islamic Sdn Bhd., as well as a decrease in loan disbursements to Kenanga Capital clients.
“The domestic economy is expected to rebound in the final quarter of the year, buoyed by
increased year-end domestic demand, rising tourist activity, sustained service sector
expansion, the government’s accelerated infrastructure projects, and a robust labour market,”
said Datuk Chay Wai Leong, Group Managing Director, Kenanga Investment Bank Berhad.
“However, the pace of growth is anticipated to be muted due to the effects of a global economic
slowdown, driven by the impact of a higher interest rate environment among advanced
economies. Additionally, there are potential downward pressures on growth, such as the
impact of an escalation of the Israel-Palestinian conflict as well as the extended UkraineRussia war. The combination of these geopolitical factors, along with a sluggish Chinese
economy, may exert pressure on global commodity prices and result in a continued weak
export performance,” added Datuk Chay.
“As market conditions remain challenging, the Group will continue to monitor the uncertainties
within the market environment to ensure the resilience of our core businesses,” concluded
Datuk Chay.
For more information on Kenanga Group, please visit www.kenanga.com.my.
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