UPDATE 1-Malaysian bank CIMB posts Q4 profit fall

Mon Feb 25, 2013 12:14pm EST

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(Adds detail on earnings decline)

KUALA LUMPUR Feb 25 (Reuters) - CIMB Group Holdings , Southeast Asia's fifth-largest lender by assets, posted a 4.5 percent decline in fourth-quarter net profit, dragged down by weaker investment returns and acquisition costs.

Malaysia's second-largest bank said that net profit for the three months to Dec. 31 was 1.08 billion ringgit ($348 million), adding that the decline was exaggerated by a 250 million ringgit gain from the re-evaluation of its CIMB Aviva operation in the corresponding period a year earlier.

Full-year net profit up nearly 8 percent at 4.35 billion ringgit was roughly in line with the average forecast of 4.31 billion ringgit in a Thomson Reuters I/B/E/S poll of 24 analysts.

CIMB, which gains about 30 percent of its earnings from operations in Indonesia, has been expanding in Asia. Last year it began the acquisition of Royal Bank of Scotland's Asian operations and the unlisted banking arm of the Philippines' San Miguel Corp.

Chief Executive Nazir Razak was upbeat on the bank's prospects in the region. "Although still quite fragile, the global operating environment is showing signs of improvement, which is key to sustaining growth in Asia," he said in a statement.

"We believe that we can sustain a net return on equity of 16 percent for 2013."

CIMB's result was in stark contrast to rival Malayan Banking (Maybank), the country's biggest bank, which last week reported a 16 percent rise in fourth-quarter profit, bolstered by higher lending.

CIMB shares were little changed at the stock market close, finishing 0.3 percent higher, in line with the broader market's 0.3 percent rise. ($1 = 3.0990 Malaysian ringgits) (Reporting By Yantoultra Ngui and Al-Zaquan Amer Hamzah; Editing by Edmund Klamann and David Goodman)

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