CORRECTED-UPDATE 1-CIMB Q2 net profit slips
(Deletes reference to Indonesia as cause of decline in profit)
KUALA LUMPUR Aug 26 (Reuters) - CIMB Group Holdings Bhd , Malaysia's No. 2 lender, said its second-quarter net profit fell 5 percent from a year earlier.
CIMB has been expanding in Asia and in 2012 acquired some of the Asian operations of Royal Bank of Scotland Plc, but the bank now faces headwinds in Indonesia - its biggest earnings contributor after Malaysia - given the country's cautious economic outlook.
The bank, Southeast Asia's fifth largest by assets, posted a net profit of 1.05 billion Malaysian ringgit ($318 million) in the quarter ended in June compared with 1.11 billion ringgit a year earlier. Still, the result was higher than the average forecast of 661.76 million ringgit in a Thomson Reuters I/B/E/S poll of two analysts.
Speaking to reporters after the results were released, group CEO Nazir Razak said he expects a stronger performance in the second half of the year.
"We think that at the operational level we will do better in the second half, riding on improved momentum in Malaysia and Singapore consumer and regional corporate banking and more flows in Treasury markets," he said.
The bank said its performance in Malaysia and Singapore helped compensate for the tough conditions in Indonesia and the Treasury business.
Indonesia accounted for 32 percent of the group's earnings last year, according to CIMB's 2012 annual report
Nazir told reporters that the bank's RBS operations could break even this year if market conditions improved.
He added that the bank plans to open branches in Laos, Hong Kong and Shanghai, but is not looking at acquisitions in the Phillipines after its talks to buy Bank of Commerce from San Miguel Corp fell through.
Larger rival Malayan Banking Bhd (Maybank) reported last week a 9 percent rise in quarterly net profit, helped by higher interest income and the sale of financial assets. Ÿ ($1 = 3.3005 Malaysian ringgits) (Reporting By Yantoultra Ngui; Editing By Siva Sithraputhran and Chris Gallagher)
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