KUALA LUMPUR: Alliance Financial Group Bhd is set to distribute a record dividend for FY12 ending March 31 due to its strong performance year-to-date.

“In view of Alliance Bank group’s strong performance year-to-date, the board had recently announced a second interim dividend of 7.7 sen per share, which will be payable on Feb 28. This brings the total dividend for the financial year to 13.3 sen, which is a significant improvement compared to last year’s dividend payout of seven sen,’ said CEO Sng Seow Wah in a statement yesterday.

The company yesterday announced its results for 3QFY12 ended Dec 31.

Net profit rose 9% to RM121.3 million from RM111.3 million the year before while revenue grew 9.3% to RM311.4 million from RM284.9 million. Net assets per share stood at RM2.39 compared with RM2.17 a year ago.

For the nine-month period, net profit grew 14.7% to RM371.8 million from RM324.3 million in the previous corresponding period, with earnings per share increasing from 21.2 sen to 24.4 sen.

Revenue rose 9% to RM935.8 million from RM858.2 million. The improvement was attributed to a strong growth in non-interest income, Islamic banking activities and lower impairment charges.

The banking group said contribution from non-interest income grew to 26.1% for the nine-month period from 21% a year before, and its medium-term target is to raise this to 30%.

Interest income grew 11% due to an 11.5% expansion in gross loans, which was supported by growth in consumer and small and medium enterprise (SME) lending.

Consumer lending, which accounts for 53% of its total loans, grew 4.9% on the back of higher housing loans disbursements. SME lending expanded 14.7% due to a growth in working capital and trade finance. In addition, customer deposits grew 9.2% year-on-year to RM30.6 billion as at end-December. Its loan-to-deposit ratio stood at 78.9%, which the company claims is the industry’s lowest.

“The group’s cost-to-income ratio maintained at 46.5% as at end-December 2011, which is a reflection of the ongoing strategic cost management initiatives,” said Sng.

“While we continue to focus on existing business opportunities in consumer banking and business banking, we are also strengthening our treasury, transaction banking and wealth management capabilities. We are confident the business strategies that are being implemented will enable the Alliance to build a successful banking franchise and generate sustainable financial performance over the long term, as well as deliver value-added services to our customers,” he added.

The banking group last year registered a record net profit of RM409 million, with earnings per share growing to 26.7 sen from 19.7 sen the year before.

Alliance ended four sen lower to RM3.75 yesterday, with 3.23 million shares traded.

This article appeared in The Edge Financial Daily, February 22, 2012.