Hong Leong Islamic Bank Berhad

Hong Leong Islamic Bank Reports Pre-Tax Profit Of RM17.1 Million For Period Ended 30th September 2005

Hong Leong Islamic Bank Berhad today announced a net profit before tax of RM 17.1 million for the first financial period ended 30th September 2005. The reported period is from the date of incorporation on 28th March 2005 to the period ended 30th September 2005

The Bank is a 100% subsidiary of Hong Leong Bank Berhad. All assets and liabilities were transferred over to the Islamic Bank from Hong Leong Bank Berhad on 1st July 2005. Previously, it operated as an 'Islamic window’ in Hong Leong Bank Berhad.

The Islamic Bank showed good momentum by contributing 9% to the Hong Leong Bank group’s pre-tax profits for the reported quarter ended 30th September 2005.

It had shown good balance sheet growth, with the Financing base at RM 3.6 billion and the Deposits from customers at RM 4.2 billion. Loan to deposit ratio stood at 85%.

To expand our product range and innovate on the Islamic offerings, we have launched new products such as Hong Leong One Account-i (current account) and enhanced 'daily rest’ Islamic Mortgage Flexi-i.

The Islamic Bank’s risk-weighted capital ratio stood at 14.33% as of 30th September 2005, supported by an initial share capital base of RM 500 million. This is above the regulatory minimum of 8%.

Hong Leong Bank's Pre-Tax Profit For Quarter Ended 30th September 2005 Of RM197 Million, Up 27% From Preceding Quarter

Robust earnings growth

Hong Leong Bank Berhad today announced a profit before tax of RM197 million for the first quarter of its financial year ended 30 June 2006. The result was 27% above the restated (according to BNM/GP8 guidelines) earnings of RM155 million for the preceding quarter.

The pre-tax profit improvement over the preceding quarter was attributed to the business growth momentum, supported by its strong consumer financing base, higher fee income and lower loan loss provisions.

On a comparison to the same quarter a year ago, the total income was better by 7% to RM379.7 million, reflecting the sustained underlying business momentum despite the competitive pressure on lending rates and our continued focus on adding value to our customers.

The requirements of the ‘Revised Guidelines on Financial Reporting for Licensed Institutions (BNM/GP8)’, which took effect in this reporting quarter, have been incorporated into the current quarter. The new guidelines require, among others, for all securities to be classified into the 3 categories, namely ‘held-for-trading, available-for-sale and held-to-maturity’. Except for the ‘held-to-maturity’ securities, all securities and derivatives are marked-to-market and any gain or loss arising from the changes in