KENANGA Investment Bank Bhd saw a year-on-year (yoy) surge in profit for the second quarter of its 2020 financial year ended June 30, which the group attributes to its digital strategy capturing the surge from retail investors.
The group saw a revenue of RM209.7 mil for the quarter, with a net profit of RM20.5 mil, more than tripling its net profit yoy from 2Q19, when the group reported a net profit of RM5.6 mil.
The surge was attributed to increased brokerage fees, trading and investment income, as well as management fee income. A share of profits was also recorded from its joint venture company, Rakuten Trade, while recording a reversal of credit loss provision.
According to Kenanga, the recent market volatility has catalysed a surge in participation from local retail investors, which in turn saw record-high trading activities in the equities market. The group noted that trading volume on Bursa Malaysia was recently reported at a daily record of 26.65 billion.
“The last few months has truly validated our digital strategy which we embarked on a few years ago. Digitalisation has enabled us to support the recent resurgence in retail participation, and to capitalise on the bullish stock market sentiments,” said Kenanga group managing director Chay Wai Leong.
Chay also believes that the group is well positioned to end the year on a positive note, citing prudent risk management practices and its foothold in the retail market.
At the end of the trading day, Kenanga’s shares were last done at 96 sen, up 7 sen, with 7.56 million shares traded. – Aug 24, 2020
