Are You Impressed With Maybank's 35% Increase In Earnings?

Maybank announced its earning. Needless to say market seems happy with its results.

On the Edge Financial Daily: Update2 Maybank 2Q net profit up 35.3% to RM993.5m

• KUALA LUMPUR: MALAYAN BANKING BHD [] posted a strong second quarter net profit of RM993.50 million, up 35.3% from the RM734.56 million a year ago on improved loan volume and it declared an interim dividend of 11 sen per share.
  
  Revenue was marginally lower by 1.22% at RM4.67 billion from RM4.73 billion a year ago. Earnings per share were 14.04 sen compared with 13.35 sen, the bank said in a statement issued on Tuesday, Feb 9.
  
  According to its financial statements, the higher earnings were due to higher non-interest income (RM1.22 billion vs RM832.18 million a year ago), lower allowances for losses on loans, advances and financing (RM243.55 million vs RM321.1 million) and lower impairment losses on securities, net (RM9.83 million vs RM22.56 million).
  
  For the six months, Maybank's net profit rose 43.5pct to a record of RM1.88 billion underpinned by higher revenue of RM9.23 billion from RM8.46 billion a year earlier.
  
  Commenting on the half year financial results, Maybank president and chief executive officer Datuk Seri Abdul Wahid Omar said the banking group was especially pleased with the performance seen at its international operations, particularly Singapore and Indonesia.
  
  "We have set our sights for more dynamic growth in the years ahead and are confident of exceeding our key targets set for the year," he said.

On Star Business: Maybank Q2 earnings up 35% to RM993mil

So how impressed are you with a 35% increase in earnings?

Surely all should be happy with a 35% growth yes?

However not all are impressed!

Firstly, flashback: Maybank Has Lost 24.1 Billion In Market Capital Since BII Deal!!!

First thing. From that posting:

• Maybank share base before the rights issue was 4,881,123 million shares. After rights issue, Maybank shares would balloon to 7,077,628 million shares!!!!

Now IF one is a long term minority shareholder, it was a 9 for 20 rights issue, which meant one had to add in additional investment of 44.9%.

Maybank's BII Deal was initally proposed back in Oct 2008. Do correct me if I am wrong.

Let's have a quick look at how Maybank was doing before Oct 2008.

Yeah that table looks a bit small, do click on it for a larger view.

Anyway, as you can see from the table above, if you take out the two extremes, on the average, Maybank was earning around 730 million per quarter.

Today Maybank earned some 993 million.

An improvement of 263 million or some 36%.

How?

As a minority investor, remember, one had forked out an additional 44.9% capital to participate in the rights issue. Today, Maybank only generate some 36% increase in earnings. Is this enough? Does it justify the rights issue?

Ok, maybe a bit difficult to understand.

Before the rights issue, an earnings of 730 million based on 4881 million shares. That would equate to an EPS (earnings per share) of around 14.9 sen!!!

Today, Maybank has 7077 million shares. An earnings of 993 million would equate to an EPS (earnings per share) of 14 sen only!!!!

How????

Are you impressed with Maybank's 35% increase in earnings?