RHB Capital Bhd has recorded an eight per cent increase in pre-tax profit to RM511.6 million for the first quarter
ended March 31, 2011 from RM474.2 million in the previous corresponding quarter.

The group attributed its improved performance to higher net interest income, other operating income, income from Islamic Banking business and lower allowance for impairment on loans, financing and other losses, partially offset by higher
other operating expenses. Revenue rose to RM1.65 billion from RM1.398 billion previously.

'The group is optimistic of stronger market demand for banking products and services and a more active capital market.

'It will remain focused on building its core businesses and will continue to look for opportunities to expand its market share and increase its leadership position in targeted markets and product segments,' said Chairman Datuk Mohamed Khadar Merican in a statement today.

He added that the outlook of the Malaysian banking sector remained positive, supported by the underlying strengths of the domestic economy and the roll out of the large-scale infrastructure projects under the Economic Transformation Programme.

RHB Bank Bhd continued to be the largest contributor to the group, accounting for 92 per cent of the group's profit.

For the quarter under review, gross loans grew by RM3.6 billion or 4.3 per cent to reach RM87.3 billion, which was broad based across different segments, in particular lending for the purchase of securities, working capital, purchase of residential property and transport vehicles.

Its customers' deposit base also grew by 4.7 per cent to reach RM98.9 billion, of which domestic customer deposits increased by 4.5 per cent as compared to the industry benchmark of 2.8 per cent.

In addition, the group achieved an annualised return on equity of 15.1 per cent and return on assets of 1.2 per cent, while its total assets expanded by three per cent to RM133.1 billion, mainly due to the increases in loans and investment assets. -- Bernama