MBSB Group Shines in Q2 2025: Strong Profitability and Strategic Momentum
Petaling Jaya – MBSB Group (MBSB) has once again captured the attention of the Malaysian financial landscape, delivering a robust performance for the second quarter and first half ended 30 June 2025. Today, we’re diving deep into their latest financial report, which paints a picture of stronger profitability, healthier asset quality, and significant progress in their ambitious FLIGHT26 transformation strategy.
For discerning Malaysian retail investors, this report offers a compelling read. The Group announced an impressive 35% year-on-year growth in Profit After Tax (PAT) for the first half of 2025, alongside a declaration of a first interim dividend of 2.0 sen per share. These are certainly figures that demand a closer look at what’s driving MBSB’s journey. Let’s explore the key highlights and what they mean for the future.
MBSB’s Financial Performance: A Half-Year of Growth
MBSB Group’s financial performance in the first half of 2025 demonstrates a strong trajectory, with key metrics pointing towards sustainable growth and operational efficiency. The Group reported a significant increase in its Profit Before Tax (PBT) and Profit After Tax (PAT), primarily driven by improved non-funded income and reduced impairment provisions. Here’s a breakdown of the core numbers:
Profitability Soars
1H 2025
Profit Before Tax (PBT): RM251 million
Profit After Tax (PAT): RM180 million
1H 2024
Profit Before Tax (PBT): RM202 million
Profit After Tax (PAT): RM133 million
The Group’s PBT for the first half of 2025 climbed 24% to RM251 million, up from RM202 million in the same period last year. This surge was underpinned by higher non-funded income (NFI) and notably lower impairment provisions. NFI saw stronger contributions from investment income, government scheme funds, and corporate advisory fees. Concurrently, PAT registered an impressive 35% year-on-year growth to RM180 million, compared to RM133 million in the previous corresponding period.
Quarterly Snapshot: Q2 2025 vs Q2 2024
Q2 2025
Profit Before Tax (PBT): RM133.8 million
Profit After Tax (PAT): RM95.6 million
Earnings per Share (EPS): 1.16 sen
Q2 2024
Profit Before Tax (PBT): RM95.7 million
Profit After Tax (PAT): RM54.8 million
Earnings per Share (EPS): 0.67 sen
Looking at the individual quarter, Q2 2025 also displayed robust growth. PBT increased by 39.9% to RM133.8 million from RM95.7 million in Q2 2024. PAT saw an even more significant jump of 74.3% to RM95.6 million, up from RM54.8 million. This strong quarterly performance contributes significantly to the positive half-year results.
Enhanced Financial Health and Stability
MBSB’s report also highlights improvements across its balance sheet and key financial indicators:
- Funding Strength: Current and Savings Account (CASA) balances increased to RM4.6 billion, representing a robust 31% increase from RM3.5 billion in June 2024. This growth was primarily driven by strong momentum in the commercial and wholesale banking segments, indicating a more stable and cost-effective funding base.
- Improved Asset Quality: The Gross Impaired Financing Ratio (GIFR) eased to 5.6% from 7.0% a year earlier. This improvement reflects the Group’s disciplined underwriting practices, effective recovery initiatives, and a well-balanced risk profile across its diverse businesses.
- Solid Capital & Liquidity: As of June 2025, MBSB maintained strong capital and liquidity buffers. The CET1/Tier 1 Capital Ratio stood at 19.8%, while the Total Capital Ratio was at 22.4%. Furthermore, liquidity coverage comfortably remained above regulatory thresholds at 156.0%, ensuring resilience against market fluctuations.
- Dividend Announcement: Reflecting its commitment to shareholder returns, the Board of Directors declared an interim dividend of 2.0 sen per share. This amounts to a payout of RM164 million, representing 91.2% of the Group’s PAT for the period.
Segmental Performance Overview
A deeper dive into the segmental results reveals the contributions of various business units. While a detailed breakdown is extensive, the overall trends indicate positive movement in driving non-funded income and managing profitability across segments like Consumer Banking, Corporate Banking, and Investment Banking. The Group’s Islamic Banking operations continue to be a core driver, showing healthy asset growth in financing and advances while managing expected credit losses diligently.
| Segment | 1H 2025 PBT (RM’000) | 1H 2024 PBT (RM’000) | Change (%) |
|---|---|---|---|
| Consumer Banking | (67,027) | 437,143 | N/A (due to loss this period) |
| Corporate Banking | 63,836 | 68,396 | (6.67%) |
| Global Markets | 51,449 | (266,389) | N/A (significant improvement from loss) |
| Investment Banking | 38,285 | 27,849 | 37.48% |
| Others | 449,599 | 167,884 | 167.82% |
| Elimination | (285,632) | (233,263) | (22.46%) |
| Total Group PBT | 250,510 | 201,620 | 24.25% |
While Consumer Banking experienced a loss, likely reflecting strategic adjustments or specific market conditions, the stellar performance in Global Markets and “Others” (which includes the holding company activities and likely significant investment income) more than compensated, driving the overall Group PBT growth. Investment Banking also showed impressive growth, underscoring the diversification of income streams.
Risks and Future Prospects: Navigating the Global Landscape
MBSB Group acknowledges that the global economy in 2025 is navigating a period of heightened uncertainty. The International Monetary Fund projects slower global growth, influenced by persistent inflation and ongoing geopolitical tensions. Closer to home, Bank Negara Malaysia (BNM) has adjusted its growth outlook, citing risks from trade tariffs. In response, BNM proactively cut the Overnight Policy Rate by 25 basis points to 2.75% in July, a move aimed at supporting economic growth while maintaining its inflation outlook at 2.5%.
Despite these external headwinds, MBSB Group’s strategy remains firmly aligned with its 3-year transformation roadmap, FLIGHT26. Group Chief Executive Officer En. Rafe Haneef emphasized, “Our first-half performance demonstrates the resilience of our earnings model and the discipline of our execution.” The Group is not merely reacting to market conditions but is actively driving its strategic initiatives forward.
Key areas of focus for MBSB Group include:
- Operational Efficiency: Optimizing the cost of funds is a crucial strategy to enhance profitability in a competitive environment.
- Financing Growth: The nationwide roll-out of Auto Financing is expected to significantly expand MBSB’s market reach.
- Non-Funded Income Streams: The launch of the ‘Global Easy Transfer’ powered by Wise, integrated into their M Journey app, is a strategic move to boost NFI through innovative digital solutions and improve customer experience.
- SME Solutions: Expanding offerings for Small and Medium Enterprises will further strengthen the Group’s franchise and contribute to broader economic development.
These initiatives are designed to accelerate the momentum of FLIGHT26, positioning MBSB well to achieve its ambitious 2026 targets of a 20% CASA ratio and RM50 billion in financing. The Group’s ability to drive operational efficiency and expand its digital offerings will be critical in capitalizing on market opportunities and mitigating potential risks in the evolving financial landscape.
Summary and Outlook
MBSB Group’s Q2 and 1H 2025 results present a compelling narrative of strategic execution and financial resilience. The significant growth in profit, coupled with improvements in asset quality and a strengthening funding base, underscores the effectiveness of their FLIGHT26 transformation journey.
The Group’s proactive approach to navigating a challenging global economic environment, through a focus on digital innovation, diversified income streams, and operational efficiency, positions it for continued progress. The declared interim dividend further reflects confidence in its sustained performance and commitment to delivering shareholder value.
Key positive factors from this report include:
- Remarkable 35% year-on-year PAT growth for 1H 2025.
- Substantial increase in CASA balances by 31%, indicating strong customer confidence.
- Improved asset quality with GIFR easing to 5.6% from 7.0%.
- Maintenance of robust capital and liquidity buffers, well above regulatory requirements.
- Declaration of a 2.0 sen interim dividend, demonstrating commitment to shareholders.
Looking ahead, the Group’s strategic initiatives, such as the expansion of Auto Financing and the introduction of “Global Easy Transfer,” are poised to accelerate its growth momentum and achieve its 2026 targets. MBSB Group appears well-equipped to adapt and thrive amidst market changes.
From an objective standpoint, MBSB Group appears to be executing its strategy effectively, especially in enhancing non-funded income and managing credit risk. The focus on strengthening the CASA base is a smart move for long-term stability. While global uncertainties persist, the Group’s clear strategic roadmap and consistent performance in key areas suggest a resilient outlook.
What are your thoughts on MBSB Group’s Q2 2025 performance? Do you believe their FLIGHT26 strategy, with its emphasis on digital innovation and diversified income, will enable them to maintain this growth momentum in the coming years? Share your insights and perspectives in the comments section below!
