CIMB Group Holdings Bhd reported a net profit of MYR 1.9 billion ($400 million) for the first quarter ended 31 March 2026, as stronger fee income and lower costs offset pressure from narrowing interest margins. Return on equity was 11.0%, while earnings per share stood at 17.8 sen. Operating income was steady at MYR 5.4 billion ($1.1 billion), supported by an 11.9% quarter-on-quarter increase in non-interest income (NOII) to MYR 1.7 billion ($350 million), driven by trading and foreign exchange (FX) gains. This offset a 5.0% decline in net interest income (NII) to MYR 3.7 billion ($780 million), as group net interest margin (NIM) contracted by two basis points (bps). Margin pressure showed early signs of stabilisation, with sequential expansion in selected markets including Malaysia, Singapore and Thailand. Total assets and gross loans rose marginally during the quarter, while the current account and savings account ratio improved to 43.3% from 42.7% three months earlier. Operating expenses fell 5.5% quarter-on-quarter as the group kept cost discipline, lifting the cost-to-income ratio to 47.2% from 49.9%. Spending on technology, data and artificial intelligence remained within its targeted range of 8% to 9%. Asset quality was stable, with the gross impaired loan ratio unchanged at 1.7%. The common equity tier 1 capital ratio stood at 14.3%. “It’s been a resilient first quarter 2026 performance for CIMB Group despite the various headwinds that we saw whether on the geopolitical side or FX (foreign exchange). The reason for this is the strong performance of NOII, driven by increase in fees and commissions as well as trade and FX. We saw increases in our trading business as well as our treasury client sales,” said group chief executive Novan Amirudin during the first quarter analyst briefing on Tuesday. He said that although NII declined due to a two-basis-point compression in NIM, early signs of stabilisation were emerging in Malaysia, Singapore and Thailand. “We actually saw some expansion in Malaysia, Singapore and Thailand. The compression of two basis points (bps) was a result of our business in Indonesia. Nonetheless, there is a 50 bps (rate) hike in Indonesia that recently got announced. Based on the current economic situations in each of the markets that we operate in, we are expecting this NIM compression to bottom out,” said Amirudin. CIMB continued its Forward30 strategy, including a MYR 2 billion ($430 million) capital return programme announced in November 2025 and the sale of CIMB Thai’s automotive financing portfolio. Proceeds from the disposal are expected to be used to reduce high-cost funding, support growth in wealth and wholesale banking, and return up to about THB 11 billion ($510 million) in capital to the group. The group’s cash-led funding strategy reduced cost of funds by seven bps quarter-on-quarter. Fee and commission income rose 4.0%, while treasury client sales increased 1.0% in the quarter. CIMB expanded its wealth franchise, including the launch of its private wealth proposition in Indonesia, with rollouts planned across Malaysia, Singapore and Thailand through 2026. Amirudin said the performance reflected resilience amid a challenging environment and early signs of margin stabilisation, supported by balance sheet discipline and steady customer activity. He said the group remained focused on capital discipline, funding strength and operational simplification under its Forward30 strategy, while continuing to invest in digital capabilities and regional growth. Amirudin said the group remains cautiously optimistic on the outlook, citing a healthy loan pipeline and resilient client franchise income, while flagging continued macroeconomic uncertainty and potential indirect effects from developments in West Asia.
